NZ GST Navigator: Your Quick Calculation Tool

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How to calculate GST for Small Businesses in NZ

In New Zealand, Goods and Services Tax (GST) is a value-added tax that small businesses need to account for in their pricing, accounting, and financial reporting. The standard GST rate in New Zealand is 15%.

 Adding GST to Prices:

  • To add GST to the price of goods or services, multiply the amount (excluding GST) by 1.15.
  • For example, if the price without GST is $100, the price including GST is $100 x 1.15 = $115.

Calculating GST from a Gross Amount:

  • To calculate the GST component of a price that already includes GST, you can divide the total amount by 9 to find 1/9th (which is the GST portion).
  • For example, if the total price including GST is $115, the GST is $115 / 9 = $12.78.

Subtracting GST from a Total Amount:

  • To find the price before GST from a total that includes GST, divide the total by 1.15.
  • For example, if the total price including GST is $115, the price excluding GST is $115 / 1.15 = $100.

Using Accounting Software:

Many small businesses use accounting software that automatically calculates GST for sales and purchases. Ensure your software is set up for the New Zealand GST rate of 15%.

Consulting with a Professional:

It’s often wise for small businesses to consult with an accountant or tax professional, particularly when first registering for GST, to ensure all processes are handled correctly.

The turnover threshold for mandatory GST registration, GST rates, and regulations can change. Always check with the IRD for the most current information. Some items may be exempt or zero-rated for GST. You’ll need to know which items these are and how to account for them in your GST calculations.