New Zealand GST returns
Any businesses registered with a New Zealand goods and services tax (GST) number must submit periodic returns to the Inland Revenue.
How often are New Zealand GST returns required?
How often you must file your GST return depends on the turnover of the GST-registered business:
- Businesses or taxable persons with sales of NZD 24 million in any 12-month period — file monthly.
- Businesses or taxable persons with sales under NZD 24 million in any 12-month period — file every two months.
- Businesses or taxable persons with sales under NZD 500,000 in any 12-month period — file every six months.
Businesses are responsible for accuracy when they file GST returns. Businesses can maintain their GST account (myIR account) online, where they can pay GST.
Filing deadlines
For GST-registered businesses, a GST return is due by the 28th of the month after the end of the taxable period. However, if the reporting period ends on November 30, the return and payment must be submitted by January 15 of the following year.
If a GST return deadline falls on a public holiday or weekend, filing obligations must be completed by the next working day.
GST refund
Businesses with a GST registration can apply for GST refunds. Requested and approved refunds are paid into a business’s bank account within 15 days. Refunds under NZD 5 are carried forward to the next taxable period. Non-resident GST-registered businesses will not need a New Zealand bank account to receive their refund.
Refunds will not be paid if they’re to be used to pay any other taxes owed. They will also not be paid if the Inland Revenue is waiting for the business to file an overdue GST return, or if any information is missing from the application.
Businesses should note that the new term for ‘tax invoice’ is ‘taxable supply information’.
GST Receipts
A business must provide receipts to buyers if they’ve been charged GST. Receipts can be used to show the tax authorities that GST has been charged and paid.
The receipt must include the name and GST number of the supplier, the date of transaction, a description and price of the goods in question, and the amount of GST included.
What GST may be deducted?
GST-registered businesses may offset in their returns any GST incurred (input GST) on supplier invoices against the GST they charge their own customers (output GST). This includes import GST as well as GST on capital goods used in the business.
Input GST must be recovered within two years of the supplier invoice. The invoice must comply with invoice disclosure rules if above NZD 50.
There are restrictions on the recovery of input GST, including assets used wholly or partially for private use or in relation to non-taxable services. Business entertainment expenses are limited to 50% of any GST.
GST penalties
Businesses can be charged penalties and interest for transgressions of GST rules. These include:
- 1% of GST due if unpaid after the first day when the GST return was due. This then increases to 4% if unpaid after 7 days. Subsequently, there is a 1% charge for each month that passes without settlement of the GST
- NZD 250 fine for late filings of GST returns
- Fines of 20% to 150% for under-declarations of GST
- 8.27% interest fines for under-declared GST
- GST offences may be regarded as a criminal offence and therefore subject to imprisonment and/or further fines
How are New Zealand GST credits reclaimed?
For GST reporting periods, where the input GST has exceeded the output GST, the credit may be refunded.
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