From 1 April 2026, members of unincorporated joint ventures can choose to account for GST individually on their share of joint venture supplies and purchases through their own GST registrations.
If members choose this option, the joint venture does not register for GST or file returns and is not considered to be a person for GST purposes. This option is called a flow‑through joint venture.
This election is only available to unincorporated joint ventures. Other types of unincorporated bodies, such as partnerships and syndicates, cannot elect to be flow-through joint ventures.
Ordinary joint ventures
If a joint venture does not elect to be a flow-through joint venture, it remains an ordinary joint venture and the current unincorporated body rules apply. This means it:
- is an unincorporated body
- is a person for GST purposes
- must register for GST if its supplies exceed $60,000
- accounts for GST in its own return, not its members’ returns.
Electing to be a flow-through joint venture
To be a flow-through joint venture, the members of the joint venture must agree in writing and notify us by completing a Non-individual Registration form online with the written agreement attached.
The election should be made by a nominated member of the joint venture.
A flow-through joint venture is not required to have an IRD number, but it will be assigned a customer identifier that can be used when communicating with us. We will send a letter with the customer identifier after we receive the election.
The nominated member can create a myIR account for the joint venture when they complete the Non-individual registration form, or they can register later with the joint venture’s customer identifier.
The members must keep records that show how each member will calculate their share of joint venture supplies and purchases. For example, a written joint venture agreement clearly showing each member’s agreed allocation of revenues and costs.
Once a joint venture elects to be a flow-through joint venture, the election cannot be revoked.
Timing of the election
Elections made before 1 April 2027 apply from 1 April 2026, or a later date if the members choose.
Elections made on or after 1 April 2027 apply from the date of the agreement between the members. We must receive the election within 21 days of the date of the agreement. We can backdate late elections in limited circumstances.
When membership changes
The nominated member needs to let us know within 21 days if a member joins or leaves a flow-through joint venture. They can send us a message in the joint venture's myIR account stating:
- the name and IRD number of the new member and the date they joined
- the name of any member who has left and the date they left.
Deregistering existing registered joint ventures
From 1 April 2026 to 31 March 2027, a joint venture that registered for GST before 1 April 2026 can cancel its registration and elect to become a flow-through joint venture. Members will account for GST individually from the date of cancellation.
Members will still be jointly and severally liable for any overdue GST payable by the joint venture for periods ending before the GST registration is cancelled.
GST registration for members
When a flow-through joint venture is carrying on a taxable activity, and the combined joint venture supplies made by that taxable activity exceeds the $60,000 registration threshold, all members must register for GST, even when a member is individually below the $60,000 registration threshold.
Register for GST
If the joint venture’s activity is below the registration threshold, unregistered members can stay unregistered unless they also make other supplies which, when combined with their share of the joint venture supplies, exceed the $60,000 registration threshold.
No reassessment of past returns
If, before 1 April 2026, the members of a joint venture treated joint venture supplies as if they were in a flow-through joint venture (consistent with the above rules), we’ll accept the members’ previous tax positions if the following apply:
- the joint venture was not registered for GST
- all members were registered for GST if the joint venture’s total taxable supplies exceeded $60,000
- the joint venture elects to be a flow-through joint venture before 1 April 2027.
Change of use adjustment
Members of a flow-through joint venture are treated as acquiring their share of previously acquired joint venture property, for the purposes of the adjustment provisions.
Previously unregistered members who later register for GST can claim an input tax adjustment for their share of the joint venture property.
Split supply rule
When members of a flow-through joint venture make a single supply together as a group, it is treated as if it is multiple separate supplies, 1 by each member, based on the agreed proportions.
The GST treatment may differ between the members depending on their registration status.
Zero-rating of an interest in joint venture property
When a member of a flow-through joint venture sells their interest in joint venture property to a new or existing member, the sale is zero-rated if the recipient is registered for GST and intends to use the interest to make taxable supplies. The recipient must let the supplier know if they meet these criteria.
If the supply is zero-rated, the supplier needs to record:
- the name and contact details of the recipient
- the registration number of the recipient
- a description of the joint venture property
- the consideration for the supply.
If the supply is incorrectly zero-rated, the GST payable must be paid by:
- the recipient, if they provided incorrect or incomplete information to the supplier
- the supplier, if their actions caused the error.
Bertha and Bevin are in a joint venture to build a boat. Neither are GST registered or carrying on any other taxable activity.
As of 1 April 2026, Bertha and Bevin expect to finish building the boat and sell it for $100,000 within the next 12 months. They will each get $50,000. Rather than register the joint venture for GST, they elect to be a flow-through joint venture.
On an individual basis, Bertha and Bevin’s supplies in the 12 months starting 1 April 2026 are not likely to exceed the $60,000 registration threshold. However, the supplies made by the joint venture itself are above the registration threshold, so they both need to register for GST when they elect to be a flow-through joint venture.
Catherine and Martin are in a flow-through joint venture on a 50:50 basis for a standardbred mare they are using for breeding after it was retired from racing.
The breeding activity is expected to produce annual supplies of about $40,000 from the sale of a foal. Because the total supplies from the breeding activity are expected to be below the $60,000 registration threshold, Catherine and Martin are not required to register for GST solely because of the joint venture.
However, Martin also operates a gardening business on his own. His gardening work produces annual taxable supplies of $50,000. When Martin’s share of the breeding activity ($20,000) is added to the supplies from his gardening business, the total value of his taxable supplies exceeds the registration threshold.
Martin must register for GST and account for output tax on his share of the joint venture supplies as well as on his supplies of gardening services.
Catherine does not carry on any other taxable activity, and her share of the breeding activity does not exceed the registration threshold. She does not need to register for GST.
Kelvin and Graeme are agricultural contractors in a joint venture and co-own 50:50 a second-hand tractor they purchased in March 2018. The taxable supplies made by the joint venture have been less that the GST registration threshold and it was not registered for GST.
Work steadily increase and in April 2026, the joint venture’s supplies grow to $65,000. They elect to be a flow-through joint venture. Because their combined joint venture supplies exceed the $60,000 registration threshold, Kelvin and Graeme both register for GST.
Kelvin and Graeme are both entitled to an input tax deduction, based on the price they paid in March 2018, for their interest in the tractor. They are both treated as having acquired their share in the tractor in March 2018.