How do I file a GST return in New Zealand?
GST returns are filed online through IRD's myIR portal by the 28th of the month following the end of the GST period (monthly, two-monthly, or six-monthly). You report total sales (output tax at 15%), deduct GST paid on purchases (input tax), and pay or receive the difference.
Detailed Explanation
## Filing a GST Return in New Zealand
### Overview of the GST Return
A GST return reconciles the GST you have charged on sales (output tax) against the GST you have paid on purchases (input tax). If your output tax exceeds your input tax, you pay the net difference to IRD. If input tax exceeds output tax (for example, after a large equipment purchase), IRD pays you a refund.
### Filing Periods
Two-monthly (most common): for most businesses, standard periods end 31 January, 31 March, 31 May, 31 July, 30 September, and 30 November. Returns due by the 28th of the following month — with two exceptions: the November period is due 15 January (holiday relief) and the March period is due 7 May (aligned with provisional tax).
Monthly
for businesses with turnover over NZD 24 million. Returns due 28th of the following month.
Six-monthly
available for businesses with annual taxable supplies under NZD 500,000. Returns due 28 January (for the period ending November) and 7 May (for the period ending March).
### What to Include in Your GST Return
Output tax (Box 8)
GST charged on your standard-rated sales. Calculate as your standard-rated sales amount x 3/23 (the GST fraction).
Input tax (Box 9)
GST you can claim on business purchases. Calculate as your GST-inclusive purchase total x 3/23. Only claim on GST-inclusive purchases — wages and rates do not include GST.
Residual
output tax minus input tax. If positive, pay to IRD. If negative, IRD refunds you.
### Zero-Rated Exports and International Services
Exported goods and services to overseas clients are zero-rated — you charge 0% GST but still claim input tax credits on related costs. Report the value in total sales (Box 5) but adjust via the zero-rated box (Box 6) so no output GST is payable. Zero-rating only applies if goods are exported within 28 days of supply and export documentation is held.
### Input Tax Credits and Valid Tax Invoices
To claim an input tax credit, you must hold a valid tax invoice. For purchases under NZD 1,000 (including GST), a simplified invoice is acceptable. For purchases over NZD 1,000, a full tax invoice showing supplier name and GST number is required if total GST is over NZD 50.
### Invoice vs Payments Basis
Invoice basis
include a sale in the period when the invoice is issued, regardless of when payment is received. Default for most businesses.
Payments basis
report sales when cash is received and claim inputs when cash is paid. Available for businesses with turnover under NZD 2 million. Better for cash flow when customers pay slowly.
### Due Dates and Penalties
Late filing: NZD 250 per return (first late filing NZD 250, second NZD 250, third+ NZD 500). Late payment: 1% late payment penalty the day after due date, plus 4% after 7 days. Use-of-money interest at approximately 10.91% per annum accrues from the due date.
### GST Refunds
IRD processes most GST refunds within 15 working days of receiving the return. Refunds are common when large capital purchases are made or when a significant proportion of sales are zero-rated exports. IRD may request supporting invoices before processing large refunds.
Source: https://www.ird.govt.nz/gst/filing-and-paying-gst-returns
Real-World Examples
Simple two-monthly return with net payment
Period ending 31 March. Sales NZD 46,000 (including GST). Output GST = NZD 46,000 x 3/23 = NZD 6,000. Purchases NZD 11,500 (including GST). Input GST = NZD 11,500 x 3/23 = NZD 1,500. Net GST payable = NZD 6,000 minus NZD 1,500 = NZD 4,500. Due by 7 May (March period exception).
Return with zero-rated exports
A software company has NZD 80,000 total sales: NZD 30,000 to NZ clients (standard-rated) and NZD 50,000 to overseas clients (zero-rated). Output GST = NZD 30,000 x 3/23 = NZD 3,913. If input credits are NZD 2,600, net payable = NZD 1,313.
Refund position after equipment purchase
A company purchases NZD 115,000 of plant (GST-inclusive). Input credit on equipment = NZD 115,000 x 3/23 = NZD 15,000. Sales for the period: NZD 46,000 output GST = NZD 6,000. Net position: NZD 9,000 refund due. IRD will refund within 15 working days of receiving the return.
Common Mistakes to Avoid
- Applying the 3/23 fraction to prices that do not include GST — if a supplier's invoice shows NZD 10,000 plus NZD 1,500 GST, the input credit is NZD 1,500, not NZD 10,000 x 3/23
- Claiming input credits on exempt supplies — you cannot claim GST on costs relating exclusively to exempt income (e.g. residential rent received)
- Missing the 28th deadline — it is the same date for both filing and payment; many businesses file the return but forget to make the payment in the same session
- Including wages and rates in the purchases figure and claiming a GST fraction on them — wages and council rates are not GST-inclusive and do not generate input credits
Frequently Asked Questions
Can I file my GST return and pay at different times?
You can file and pay separately through myIR, but both must be completed by the 28th of the month to avoid penalties. Filing on time but paying late attracts late payment penalties. Best practice: do both in one myIR session.
What if I made an error on a previous GST return?
For small errors (under NZD 1,000 net GST or 2% of the output tax, whichever is lesser), adjust the current period's return. For larger errors, file an amended return through myIR or contact IRD. Interest applies from the original due date on any additional GST owed.
Do I need to file a GST return if I had no transactions in the period?
Yes, you must file a nil return for every period until you deregister. Filing nil returns keeps your GST registration active and avoids late filing penalties. A nil return takes about 2 minutes to complete online.
How do I handle GST on mixed-use expenses?
Claim only the GST fraction on the business-use proportion. For example, if your phone bill is NZD 150 per month and it is 70% business use, your input credit claim is NZD 150 x 70% x 3/23 = NZD 13.70. Keep records of how you determined the business-use percentage.
How do I pay GST to IRD?
Via myIR using direct debit, internet banking to IRD's bank account (use your GST number as the reference), or credit card (1.42% surcharge applies for credit cards).
Practical Tips
- Reconcile your GST return against your accounting software before filing — the output GST in your return should match the GST collected figure in your accounts software.
- Automate the link between your accounting software and IRD — Xero and MYOB can pre-populate GST returns directly from your reconciled accounts, significantly reducing manual data entry and errors.
- Set a recurring calendar reminder for the 25th of each month following a GST period — gives you 3 days to review and file before the 28th deadline.
- Keep all supplier tax invoices in a cloud folder organised by GST period. If IRD requests supporting documentation for a refund, you can respond quickly with a complete set of invoices.
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