Claiming GST NZ: input tax overview for businesses

What is claiming GST?

Most registered businesses are charged GST on supplies they buy for their taxable activity. The GST you claim back is input tax. The GST you charge customers is output tax. On each return, IRD expects you to net the two: output tax minus input tax equals GST to pay or a refund.

IRD’s claiming GST page states that input tax is subtracted from output tax to calculate tax to pay or a GST refund. You can only claim to the extent goods and services are used in your taxable activity to make taxable supplies. Private use, exempt supplies, and costs with no GST component do not create a credit.

Topic specific guides in the Business and Expenses GST category cover entertainment, reimbursements, and bad debts. For add or remove maths on a single invoice, use the free GST calculator.

How does claiming GST work?

The mechanics are simple. Collect GST on taxable sales, keep evidence of GST on purchases, then file in myIR for each taxable period (monthly, two monthly, or six monthly depending on turnover and elections).

Example: output tax on sales $900, input tax on purchases $400, net GST payable $500. If input tax exceeds output tax, IRD generally refunds the difference, which is common for exporters, asset heavy periods, or seasonal businesses with large upfront costs.

Step by step filing sits in how to file your GST return in myIR. The 3÷23 formula for finding GST inside an inclusive price is in GST maths NZ.

What you can claim GST on

You can claim input tax on goods and services acquired for making taxable supplies in the course of your taxable activity, provided GST was charged (or a special rule such as secondhand goods applies) and you hold the right records.

• Stock and materials for resale or use in taxable services
• Tools, equipment, and software used in the business
• Professional fees from GST registered accountants, lawyers, or consultants
• Commercial rent and utilities for business premises
• Business travel that is not blocked by entertainment rules
• Advertising and marketing for taxable supplies
• Motor vehicles and fuel to the extent of business use
• Imported goods where Customs charged GST at the border
• Asset purchases including vehicles and construction inputs used in taxable activity

Sole traders follow the same input tax rules as companies. Registration still requires a taxable activity. See how to register for GST in NZ if you are not yet registered.

What you cannot claim

Common non claimable areas include:

• Private or domestic costs with no business use
• Purchases from non registered suppliers where no GST was charged (except secondhand goods rules)
• Exempt supplies such as long term residential rent: related costs generally carry no input tax
• Wages and salaries (not a GST supply)
• Many financial services including interest (exempt)
• Fines and penalties
• Costs without supporting records when IRD requires taxable supply information
• Full GST on entertainment where only 50% is deductible

Residential rental property expenses are a frequent search term. Long term residential accommodation is exempt from GST, so you cannot claim input tax on rates, repairs, or agent fees for that exempt activity even if you are GST registered for other work. Mixed portfolios need careful separation. See exempt vs zero rated supplies.

Records: taxable supply information

Since 1 April 2023, IRD’s taxable supply information rules set the minimum records to support GST in your returns. The calculation of GST has not changed; invoicing language has. You may still use documents marked “tax invoice” if they hold the required details.

For lower value purchases, basic records can be enough. For higher values, hold the fuller set before you claim. IRD’s online tool helps decide what to keep when you buy or sell. Full detail is in taxable supply information and GST record keeping NZ.

Claiming GST without a receipt is risky above the thresholds IRD expects documented evidence for. Under $50 purchases may be supported by simpler records, but you still need something that shows the transaction. Staff reimbursements need the employer to hold the supplier’s information: see claiming GST on staff reimbursements.

Non registered suppliers and secondhand goods

If you buy from an unregistered person, they should not charge GST. Normally that means no input tax credit. IRD’s special supplies guidance treats secondhand goods differently: goods previously used by someone else (including land in some cases) may qualify for a calculated credit when bought from a private seller.

You must pay before you claim, keep seller name and address, date, description, quantity, and price, and calculate GST as 3÷23 of the amount paid. Trade Me and marketplace buys can qualify when the seller is private. Full rules sit in GST on second hand goods NZ.

Claiming GST on imports and overseas purchases

Overseas suppliers often do not charge New Zealand GST unless they carry on a taxable activity here. When goods are imported, Customs usually charges GST as they enter New Zealand. IRD says you can claim that GST if you are registered and use the goods solely to make taxable supplies, supported by Customs documents. BR Pub 22/07 covers importer evidence.

Use the GST on imports calculator for border maths. Low value goods may be charged GST at checkout by the seller or marketplace instead. International services can trigger reverse charge style rules in some cases: see advanced posts if you buy digital services from offshore.

Keywords about claiming Australian GST, Singapore GST, or airport refunds on departure refer to other countries’ tourist or visitor schemes. New Zealand does not offer a general retail GST refund for tourists leaving Auckland or other airports. Business input tax claims are separate and require GST registration and taxable use.

Mixed business and private use

You can only claim GST to the extent costs are used in your taxable activity. IRD describes two adjustment approaches on its claiming GST pages:

• Apportionment method: estimate a fair and reasonable business percentage and claim that share. Review if use changes.
• Principal purpose method (goods and services $10,000 or less excluding GST): if the principal purpose is making taxable supplies, claim full GST; if not, claim none. You may still choose apportionment.

Mixed use assets such as holiday homes, boats, or aircraft have specific apportionment rules. Vehicles, home office costs, phones, and laptops often need a logbook or area calculation. Detail is in claiming GST on a car or home office and business vs personal GST calculator.

Common expense types

Vehicles, fuel, and financed purchases

Claim GST on vehicle purchase or lease costs to the extent of business use. Fuel receipts support periodic claims. Hire purchase agreements can allow the full GST on the cash price upfront under the GST Act hire purchase rule; operating leases spread credits over payments. See GST hire purchase and leases NZ.

Entertainment and meals

Business entertainment is often only 50% deductible for income tax, and GST input tax follows the same split. Claiming the full 15% on a client lunch is a common audit trigger. Rules and examples are in entertainment expenses: the 50% rule.

Construction, property, and rates

Commercial construction and commercial property costs can carry GST credits when the supply is taxable. Residential rental is different: exempt output generally blocks input tax on related expenses. Commercial property purchases follow normal taxable supply rules with full documentation.

Prepaid expenses and old invoices

Advance payments can have special timing under IRD special supplies rules. If you missed claiming input tax in the correct period, you may include it in a later return within the time limit below rather than assuming any old invoice is open forever.

Zero rated supplies and input tax

Zero rated supplies are taxed at 0% on the sale side, but you can usually still claim input tax on costs used to make those supplies. Exporters often receive refunds for this reason. Exempt supplies are different: they sit outside GST on output and generally block related input tax. The distinction matters for property, financial services, and donated goods.

GST refunds when claiming back more than you collect

When input tax exceeds output tax, myIR shows a refund. IRD typically processes refunds within about 15 working days if your account is in good standing, though timing varies. Large asset purchases, import heavy periods, or startup cost spikes often produce temporary refund positions.

Repeated refunds with little taxable sales can prompt IRD to ask whether a taxable activity still exists. That is a registration integrity issue, not a math trick. Keep evidence of ongoing taxable supplies.

Time limit for claiming input tax

Under the proviso to section 20(3) of the GST Act, you generally have two years from the earlier of the payment date or the invoice date to include an omitted input tax credit in a later return. IRD’s QB 09/04 explains this limit and limited exceptions (for example some disputes or inability to obtain an invoice).

After two years, a claim in a current return may not be available unless an exception applies. You may instead need to ask the Commissioner to amend an earlier assessment, subject to separate time bar rules. Minor errors may be corrected in a following return under section 113A if they meet the minor error definition.

Claiming GST before registration

You cannot claim input tax until you are GST registered for a taxable activity. On registration, IRD may allow claims on certain assets or stock held at the registration date, subject to specific rules and evidence. Pre registration purchases are a common accountant question: get advice if stock, vehicles, or land are involved.

Practical checklist

• Confirm you are GST registered and the expense relates to taxable supplies.
• Check the supplier was registered or a special rule (secondhand goods, imports) applies.
• Hold taxable supply information before claiming.
• Apportion mixed use costs fairly.
• Apply 50% limits to entertainment where required.
• Claim import GST only with Customs support and taxable use.
• File in the correct period and within the two year claim window.
• Separate exempt activities such as residential rent from taxable business lines.

Common traps are summarised in navigating the GST minefield. Publisher path: About Us and Contact Us.

FAQs

What does claiming GST mean in New Zealand?

It means deducting input tax on business purchases from output tax on your sales when you file a GST return. The credit reduces net GST payable or can produce a refund.

Can I claim GST from a non registered supplier?

Usually no, because no GST was charged. Secondhand goods from private sellers are the main exception when IRD’s record and payment rules are met.

Can I claim GST on imports to New Zealand?

Yes, if you are GST registered, use the goods to make taxable supplies, and hold Customs documents IRD accepts. Overseas suppliers often do not charge NZ GST; Customs charges GST at the border instead.

Can a sole trader claim GST on business expenses?

Yes, once registered for a taxable activity. The same input tax rules apply as for companies. Keep records in the business name or clearly linked to the taxable activity.

How long do I have to claim GST input tax in NZ?

Generally two years from the earlier of payment or invoice date to include an omitted credit in a later return. Limited exceptions and Commissioner amendment rules can apply after that.

Can tourists claim GST back when leaving New Zealand?

No general tourist refund scheme applies at New Zealand airports. Input tax credits are for GST registered businesses on taxable activity expenses, not visitor retail refunds on departure.

Last verified 28 August 2026 against Inland Revenue claiming GST, claim input tax credits on expenses, taxable supply information, special supplies (secondhand goods), GST guide IR375, Goods and Services Tax Act 1985 s 20(3), and QB 09/04. Ads may fund this free site. Not Inland Revenue. Not tax advice.