11/03/2024
From 1 April 2024, online marketplace operators (also known as digital platform operators) will need to collect GST on all listed services provided through their online marketplace.
What’s changing?
GST registered online marketplace operators facilitating the sale
of ‘listed services’ must collect and return GST of 15% when the
service is performed, provided, or received in New Zealand.
What are listed services?
Listed services are:
• ride-sharing and ride-hailing
• food and beverage delivery
• short-stay and visitor accommodation.
GST will also apply to closely connected services if they’re
facilitated through the online marketplace. For example, holiday
rental cleaning fees charged on top of the accommodation costs.
How are drivers, deliverers and accommodation hosts affected?
If you perform or provide listed services in New Zealand using
an online marketplace, how these new rules apply to you will
depend on whether you are GST registered or not.
If you are GST-registered, from 1 April 2024 you will need
to treat the supply of listed services sold through online
marketplaces as a zero-rated supply on your GST return. You can
continue to claim GST on the costs you incur in making these
supplies.
There are opt-out rules for large GST-registered sellers. If you
meet the criteria, you can carry on being responsible for the GST
obligations including providing taxable supply information to
customers.
If you are not GST-registered, from 1 April 2024 a new flat rate credit scheme will apply. Under this scheme your online
marketplace will collect GST at the standard 15% rate. They will
return 6.5% to Inland Revenue and will pass the remaining 8.5%
to you. This flat-rate credit is for you to keep and recognises costs
you incur when supplying these services.
Example – GST-registered seller
Amy is GST-registered. She rents out a property on an
online marketplace for $100 per night. The property is
in New Zealand and is available for short-term holiday
accommodation.
The online marketplace adds 15% GST to the nightly rate,
charging guests $115. They include $115 as sales and income
in their GST return.
In Amy’s GST return, she includes:
• $100 as sales and income and $100 as a zero-rated supply.
The zero-rated supply is subtracted from sales and income
resulting in $0 total GST collected.
• Amy claims back GST on the purchases and expenses
incurred to rent out her property as short-term
accommodation.
Example – Non-GST-registered seller
Jared is not GST registered. He provides driving services in
Wellington on a ride-hailing platform.
The platform charges a customer a fare of $30 for Jared’s
services. The platform adds 15% GST to this fare, charging the
customer a total of $34.50.
As Jared is not GST registered, the GST amount of $4.50 is
accounted for in the following way:
• $1.95 (6.5%) is returned to Inland Revenue
• $2.55 (8.5%) is passed on to Jared.
Jared receives a monthly statement from the platform
confirming the flat-rate credits passed on to him.
You will need to tell your online marketplace if you are GST
registered or not.
Do you need to register for GST?
If you are not registered for GST, you will need to register if you
have earned, or will earn more than $60,000 from all your taxable
activities in any 12-month period. This includes sales provided
directly to customers (for example through your own website) or
made through an online marketplace.
You may also register voluntarily if you earn less than this.
It is important to tell your online marketplace if your GST
registration status changes.
