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How to calculate GST for Small Businesses

As a small business, if you’re turning over more than $60,000 per year and registered for GST, you need to add 15% to your intended sales price when making a sale.

If your small business issues invoices in the usual course of your sales process, you’ll need to clearly indicate the GST component of the sale in an itemised manner on any tax invoice you issue.

You can use our GST calculator to find GST inclusive and exclusive prices, or the correct GST content of a product or service.

Please enter an amount (sales price)
You can change the GST rate here. The current GST rate in NZ is 15%

Adding GST to your NET sales price (sales price excluding GST)

Starting Value (Net of GST)
Gross Value (Sales price after GST)
Result 1

Deducting GST from your GROSS sales price (sales price including GST)

Starting Value (Gross of GST)
Net Value (Sales price after GST)
Result 2

Instructions for using the GST calculator:

  1. Add your sales price in the box next to the $ sign above
  2. If you want to add GST to this price then you need RESULT 1
  3. If you want to deduct GST from this price then you need RESULT 2

What is GST? Understanding the basics

GST stands for ‘goods and services tax’. It’s a 15% tax that’s added onto the price of goods and services in New Zealand.

GST will impact your business if you are ‘registered for GST’. As a business that’s registered for GST, you will add GST onto products and services you sell, collect it from your customers, then pass it onto the government when you file a GST return.

You can also claim back GST that you have paid when buying goods or services that are related to your line of business. For more on claiming back GST see: How to claim back GST.

Do I have to register my business for GST?

You need to register for GST if you have a company that earns more than $60,000 a year, or you earn more than $60,000 a year as a self-employed individual.

If you’re an individual, the $60,000 threshold applies only to the income you earn that isn’t liable to PAYE. For example, if you do $15,000 worth of freelancing on top of a salary that has PAYE applied to it, you don’t have to register for GST. But you can if you want to.

Some people register for GST even if they don’t have to. It means they can claim GST on materials and services they use for their business. If you decide to go this way, you need to be aware that your prices to customers must include GST. Also, you are obligated to do GST returns on time, every time.

How do I create a GST invoice?

When you’re an individual or company that’s registered for GST, your invoices are known as ’tax invoices’. They need to include 15% GST, as well as a number of other fields:

  • Your trading name
  • Your GST numberInvoice date
  • Due date
  • A description of the goods or services that are being invoiced
  • Subtotal
  • Total GST @ 15%
  • Total amount due NZD

Another nice-to-have is your logo. It will make your invoice look smarter and more professional. For more information on invoicing see: How to invoice like a pro.

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