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When they’re used

In some cases a buyer is in a better position than a seller to determine the price of goods or services. The buyer issues the tax invoice rather than the seller.

Buyer-created tax invoices are most commonly used in New Zealand’s primary industries such as farming, fishing and wine-growing.

In these industries, the value of the goods is only known after the buyer processes them.

An example is an abattoir buying sheep from a farmer. The abattoir weighs, slaughters and prices the sheep. It also determines other costs such as levies. The abattoir is in a better position than the farmer to issue a tax invoice.

Rules for buyer-created tax invoices

GST-registered buyers need to get our approval to issue buyer-created tax invoices.

A buyer can be approved to issue invoices for:

  • particular goods or services
  • a particular supplier or group of suppliers.

A buyer-created tax invoice can only be used if both the buyer and the seller:

  • are GST-registered
  • agree in writing that only the buyer will issue the tax invoice
  • keep a copy of the tax invoice.

A buyer-created tax invoice must show:

  • the standard information for a tax invoice
  • the buyer’s and seller’s GST numbers
  • the words ‘buyer-created tax invoice – IRD approved’ in a prominent place.
  • 15% GST added to the gross supply of goods or services
  • 15% GST added to any deductions or charges.

An example of a buyer-created tax invoice.

Last updated: 28 Apr 2021
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