GST is New Zealand's form of indirect value-added tax. It is a tax on the goods and services provided by a GST-registered person in their business. It is charged at the rate of 12.5% to the person (including other businesses) who buys the goods or services. It is not a tax on the business.
Anyone with a business turnover of $40,000 or more (excluding GST) must register for and charge GST. Registration is optional if the annual turnover is less than $40,000. When registered, the business completes regular GST returns (every one, two or six months) and pays or receives the difference between the GST charged and GST paid on business expenses. If a business is not registered for GST, it cannot charge or claim back GST.
Some goods and services, such as rent from domestic accommodation and income from financial services, are exempt from GST.
