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Changes to NZ GST rules for low-value imported goods
Becky Zhang, CA
In an increasingly disrupted world, the laws surrounding consumer processes sometimes need to play catch up.
From 1 December 2019, overseas businesses selling low-value goods to consumers in New Zealand may need to register for, collect and return NZ Goods and Services Tax (GST) of 15% on goods valued at or below $1,000.
Low-value goods are those valued at NZ$1,000 or less (excluding GST). Examples include books, clothing, cosmetics, shoes, sporting equipment and electronic items. New Zealand Customs Service will continue to tax goods sold for more than NZ$1,000 at the border as they come into New Zealand.
With the significant growth of online shopping in the everyday lives of New Zealanders, this proposal by the Inland Revenue seeks to level the playing field so that offshore firms cannot undercut our domestic retail sector.
This is good news for retail businesses in NZ. The Inland Revenue will have greater transparency of the transactions between New Zealand customers and offshore suppliers.
Businesses must register for GST if their total sales, including services, digital products and low-value goods, to consumers in New Zealand exceed or are likely to exceed NZ$60,000 in any 12-month period from 1 December 2019.
The rules apply to overseas businesses selling low-value goods directly to New Zealand consumers, as well as online marketplaces and re-deliverers.
From early September 2019, overseas businesses will be able to register.
You can find out more in the IRD policy update
Becky came to New Zealand in 2005. Before her immigration, she obtained a Bachelor Degree in International Business in China and worked as a financial controller in a multinational prestige car manufacturer. In 2009 she graduated from Auckland University with a Bachelor of Commerce Degree majoring in Accounting and Taxation. Upon the invitation from Auckland University, she completed Bachelor of Commerce Honours Degree in 2010 and later worked as a commercial accountant in the New Zealand tourism industry.
In 2013, Becky joined Lynch and Associates and started her accounting career in public practice. She speaks Mandarin and understands Cantonese and likes to provide her clients with valuable and innovative advice and support the success of their business.