Providing after-sales service
Whether you provide after-sales service through a free or user-pays helpline or by providing a service person to maintain your products, you may have tax requirements.
Free after-sales service through a helpline
| If you ... | and ... | then you will ... |
|---|---|---|
| provide after-sales service through a helpline | the staff who answer the helpline are outside of New Zealand | have no New Zealand employer requirements. |
| provide after-sales service through a helpline | the staff who answer the help line are in New Zealand | need to apply for an IRD number and register as an employer. |
| charge for your after-sales service | it is performed in New Zealand and your service exceeds NZ$60,000 in any 12 month period | need to register for GST. |
After-sales service provided through a service person
If you provide after-sales service through a service person in New Zealand who physically maintains the goods then you may have need to register as an employer.
| If you pay ... | then you have ... | and you will need to ... |
|---|---|---|
| a salary or wage to the person maintaining your goods | an employee | deduct PAYE from their wages. |
| pay solely on a commission basis when your products are maintained | a contractor | deduct withholding tax from the payments you make to them.* |
| If you ... | then you have a ... | and ... |
|---|---|---|
| contract a service person to maintain your products and pay on invoices received from the service person |
|
you will need to deduct withholding tax from payments you make to them. |
|
they are responsible for their own tax. |
* The deduction of withholding tax can be industry, or role-specific. You can find out if your contractor is subject to withholding tax by reading their Tax code declaration (IR330).
** If your contract is with a company, or your contractor is not subject to withholding tax, they are an independent contractor.
Note
If you have an employee or a contractor who is subject to the withholding tax rules then you will need to apply for a New Zealand IRD number and register as an employer.
You can find the IRD number application - non-individual (IR596) and Employer registration (IR334) forms under Forms and guides >
Find out more
For more information on the withholding tax rules please refer to the Employers guide (IR335). You can find it under Forms and guides >
Date published: 31 Mar 2009
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