GST for NZ tradies: what you need to know
A plain-English guide to GST for New Zealand sole traders and small trade businesses. When to register, how to charge it, and how to file.
GST confuses a lot of tradies. Here's the plain-English version.
What is GST?
GST (Goods and Services Tax) is a 15% tax added to most goods and services sold in New Zealand. It's collected by businesses on behalf of the government and paid to IRD.
When do I have to register?
You must register for GST when your annual turnover exceeds $60,000 NZD in any 12-month period. Once you hit that threshold, you have 21 days to register with IRD.
You can register voluntarily before $60,000 — some tradies do this so they can claim GST back on their purchases.
How does it work in practice?
Simple: you add 15% on top of your prices. If you charge $100 for labour, your invoice shows:
- Labour: $100.00
- GST (15%): $15.00
- Total: $115.00
You collect the $15 from your client and pay it to IRD when you file your GST return.
What can I claim back?
When you're GST registered, you can claim back the GST on your business expenses — tools, materials, fuel, work vehicle costs. This is called an "input tax credit."
So if you spend $230 on materials (including $30 GST), you can claim that $30 back.
How often do I file?
IRD lets you file monthly, two-monthly, or six-monthly depending on your turnover. Most small tradies file two-monthly.
What happens if I don't register when I should?
IRD can back-date your registration and charge you the GST you should have collected — out of your own pocket. Don't ignore the $60k threshold.
How does JobTap help?
JobTap's GST calculator tracks whether you're approaching the threshold. If you're registered, GST is calculated automatically on every quote and invoice. If you're not registered, JobTap removes GST and adds the correct note to your invoices.
Questions about your specific situation? Talk to an accountant or visit ird.govt.nz. This article is general guidance only.