You are only required to charge GST on a sale of low value imported goods if it is a taxable supply. A supply is taxable if:
- the goods and services are treated as supplied in New Zealand
- you are registered or required to be registered for GST, that is your turnover was $60,000 in the last 12 months (or will be $60,000 or more in the next 12 months)
- it is made in the course of your taxable activity, or it is treated as being part of your taxable activity because you are an online marketplace operator or a redeliverer
- the supply of your goods and services is not an exempt supply.
When a sale is connected with New Zealand
From 1 December 2019, imported goods supplied to a customer are treated as supplied in New Zealand if the:
- goods individually have a customs value of NZ$1,000 or less
- overseas business has chosen to charge GST on high value goods sold to a consumer
- merchant, online marketplace operator or redeliverer assists in bringing the goods to New Zealand.
Sales to New Zealand GST-registered businesses for business use
GST does not generally apply to sales of low value imported goods made to New Zealand GST-registered businesses for business use.
An overseas GST-registered business can choose to charge GST on a sale to a New Zealand GST-registered business if:
- the value of the goods is NZ$1,000 or less
- in the 12 months after the sale, the business expects more than 50% of all its sales to New Zealand customers will be made to customers who are not registered for GST.
Overseas suppliers can presume that a New Zealand customer is not a GST-registered business unless they have provided their GST registration number or New Zealand Business Number, or otherwise notified the supplier of their status as a GST-registered business.
Charging and collecting GST
An overseas business required to register must charge and collect GST on the services and low value goods they sell to consumers in New Zealand. They must pay the GST collected to us.
Overseas businesses also need to let consumers know GST has been applied. They can do this by providing a receipt showing:
- the amount of GST charged
- their GST registration number.
Tokens, stamps or vouchers
GST may be payable when a token, stamp or voucher is either:
- redeemed for goods and services.
The issuer or seller can treat the supply as occurring for GST purposes when:
- it is redeemed for low value goods or remote services
- the supplier of the goods and services is a different person.
Calculating GST on taxable goods
The value of a supply of taxable goods is not the same as the estimated customs value that will usually include amounts for related services such as freight and insurance.
The amount of GST required to be returned is 15% of the value of the supply. For goods that are priced inclusive of GST, the amount of GST to be returned will be equal to the amount of consideration for the supply multiplied by 3 ÷ 23.
Wendy purchases a fascinator
Wendy purchases a fascinator from Wild Hats, an e-commerce business based in Australia. Wild Hats is registered for GST in New Zealand.
The price of the fascinator is NZ$23 including GST. Wendy also pays a shipping fee of NZ$11.50 (GST-inclusive). The total amount paid by Wendy including GST is NZ$34.50.
The GST returned on the supply by Wild Hats is NZ$4.50 (NZ$34.50 × 3/23 = NZ$4.50). This includes the NZ$1.50 of GST included in the shipping fee.