NEWS

There has been a lot of confusion surrounding the changes to GST regarding Uber, Airbnb and other electronic marketplaces. Particularly about whether GST registration is required or not. The rules regarding GST registration have not changed, you are only required to register for GST if your turnover is over $60,000, if it does not exceed this you are not required to register for GST.

Any bookings made prior to 31 March 2024 for future dates fall under the old rules, there is no change.

If you have a listing intermediary – such as a property manager dealing with your Airbnb, the electronic marketplace will be liable for the GST, the flat-rate credit will be the responsibility of the listing intermediary.

 

GST registered?

If you are GST registered, you need to ensure that you have notified the marketplace. A GST registered person needs to enter their income in the zero-rated box in the GST return, this will effectively mean that there is no GST on income in the GST Return. There is no change to how you claim the expenses in your GST Return. If using Xero ensure you change the GST tax type to zero-rated GST, this will then pull through to the correct area in your GST return. If all your rental income is via a marketplace provider, you will have GST refunds each period.

 

Not GST registered?

If you are not GST registered, the online marketplace will add on 15% GST onto your rate. As you are unable to claim GST on your expenses, there is a Flat-Rate credit scheme, which means 8.5% is passed back to you. So, if accommodation is $200+GST, the GST will be $30, the flat rate credit at 8.5% is $17, the marketplace will pay $13 to the IRD and $17 to you, the supplier. There are flow-on income tax consequences regarding this too. Please contact us to discuss.

It is important to advise the marketplace provider correctly if you are GST registered or not. If you advise you are not GST registered when you are, you will have incorrectly received the Flat-Rate credit, which would need to be returned to IRD with potential penalties. It is you as the supplier that will be liable for any errors, not the marketplace.

 

GST registered and want to opt out?

There are some circumstances where you can opt out of these rules, you must be a large supplier – turnover greater than $500,000, not a natural person and 2,000 + nights’ accommodation on one marketplace provider.