New Zealand GST Changes – is your Online Business Ready?

If you’re shipping low-value goods to customers in New Zealand, you’ll need to know about their new GST rules, which are coming into effect on 1 December 2019.

We’ve put together a handy summary to help you get ready for the changes.

What’s changing?

From 1 December 2019, overseas businesses that sell low-value goods to consumers in New Zealand may need to register for, collect, and return GST of 15%.

A low-value good is a physical good valued at NZ$1,000 or less (excluding GST), such as books, clothing, cosmetics, shoes, sporting equipment and small electronic items.

Who’s impacted by the changes?

If the value of goods sold to New Zealand customers exceeds or is likely to exceed NZ$60,000 over a 12 month period, you will need to register for, collect, and return New Zealand GST on those sales.

The GST charged at the point of sale is based on the customs value of the goods plus any shipping and insurance charges.

How can you get ready for the changes?

If the changes apply to your business, the legislation requires overseas businesses to:

  1. Update their business systems so they can collect and return GST.
  2. Register for GST in New Zealand, and collect GST on each good valued at NZ$1,000 or less that is sold to customers and delivered to addresses in New Zealand.
  3. Provide the consumer with a receipt that clearly shows the amount of GST charged.
  4. Return that GST to New Zealand Inland Revenue.

Even if you don’t meet the NZ$60,000 threshold right now, keep track of your turnover so that you’re not caught off guard if the GST rules apply to your business in the future.

What do the changes mean for Shippit users?

If you’re using Seko, InXpress, DHL Express or any other service provider to ship internationally to New Zealand, you’ll need to make sure you comply with the new GST rules.

You’ll also need to add your New Zealand IRD number to your Shippit account (go to Settings, then General). We’ll send your IRD number directly to the courier when you manifest a shipment. The courier will reference your NZ tax number when submitting your low-value import to New Zealand customs.

Where can I get more information?

Check out the New Zealand Inland Revenue website for further information about the GST changes. They have also created a short fact sheet for easy reference.