Introducing private assets into a GST registered business NZ
A Hamilton electrician already files GST on jobs. The ute in the driveway was bought years ago as a family vehicle. The laptop on the kitchen table started as a home computer. The question is not “can I sneak them onto the plant register”. It is whether introducing private assets into a GST registered business creates a claim now, and a GST bill later.
Inland Revenue treats that move as an acquisition. GST guide IR375 (March 2026) says you acquire a good or service when you either purchase it or introduce it into your business (taxable activity). The GST adjustments page (last updated 31 March 2026) says the same thing in one line: you may purchase goods for use in your business, or you may introduce already owned goods and services into your business. You then adjust for how much you will use them, or they are available to use, for business rather than private use, like private use of a car.
The claim is only as wide as taxable use
Inland Revenue’s claiming GST page (last updated 1 April 2023) says you can only claim GST on goods and services to the extent they are used in your taxable activity to make taxable supplies. You cannot claim GST for supplies you use privately or to make exempt supplies. A refund on day one does not freeze the asset as “business forever”.
What happened in the driveway
Hypothetical. The electrician is already GST registered. Turnover from the taxable activity sits over $60,000, which IR375 treats as the compulsory registration line for a taxable activity (over $60,000 in the last 12 months, or expected to go over $60,000 in the next 12 months). The ute is not a new purchase from a dealer. It is already owned. Starting to use it on jobs is introducing it. Category home: Property & Assets GST Hub.
Two different files then open. If the same human keeps using the ute as a sole trader, IR375’s acquire or introduce rule plus the $10,000 exclusive split decides the first claim. If a Ltd company buys the ute from its owner, that is a secondhand goods purchase from an associated person. Inland Revenue’s special supplies page says secondhand goods are goods previously used by someone else, and that includes land. You must make a payment before you claim. Those are not the same transaction.
The $10,000 fork
Inland Revenue splits the first claim by GST exclusive cost. At $10,000 or less you may use the principal purpose method or the apportionment method. Over $10,000 exclusive you must apportion. You cannot use principal purpose for those higher value goods.
| Cost (GST exclusive) | First claim | Later reviews |
|---|---|---|
| Up to $10,000 | Principal purpose: full GST if the main purpose is taxable supplies, or nil if it is not. Or choose apportionment for the business percentage, then use that method on all such goods for at least 24 months | 0 adjustment periods. Inland Revenue’s change in use page: you will not need a change in use adjustment if GST exclusive cost is $10,000 or less |
| $10,001 to $20,000 | Apportion on a fair and reasonable percentage (logbook, floor area, past records, business plans) | 2 adjustment periods |
| $20,001 to $500,000 | Same apportionment on acquisition | 5 adjustment periods |
| Over $500,000, or land of any value | Apportion. Land stays in the 10 period column even if the dollars are small | 10 adjustment periods |
Inland Revenue’s Phil example: a GST registered contractor buys a laptop for $3,000 GST exclusive for the main purpose of making taxable supplies, with some private use. He can claim the full GST. Amy’s example on the same page: a car for $10,350 including GST of $1,350, mainly private, 10% business. Exclusive cost is under $10,000. Principal purpose gives no claim. Apportionment lets her claim 10% of the GST, then she must use that method on all goods or services at $10,000 or less exclusive for at least 24 months. Walkthroughs: claim GST on a car or home office and GST change of business use NZ.
For a vehicle over $10,000 exclusive, Inland Revenue says you can calculate a private use adjustment by keeping a logbook and comparing private kilometres with total kilometres. Tax Technical’s 2012 logbook article records that a motor vehicle logbook kept for income tax may also be used for GST apportionment, from 1 April 2011. Home office claims compare floor area of the office to the total floor area of the home. IR375 adds time spent on income earning activities as well as percentage area. You cannot claim GST on private or domestic expenses.
Pull highlight: Change in use is skipped when exclusive cost is $10,000 or less, when the adjustment is less than $1,000 and the change in taxable use is less than 10%, or when exempt supplies in the period are less than both $90,000 and 5% of total consideration for taxable and exempt supplies. Those de minimis rules are on Inland Revenue’s change in use page (last updated 1 April 2026).
Secondhand goods when a company buys your stuff
If a GST registered company pays you for a used ute, Inland Revenue may treat that as secondhand goods. IR375: secondhand goods are goods previously used and paid for by someone else. They do not include new goods, unused primary produce, goods under a lease or rental, livestock, or fine metal (with a manufactured jewellery style exception). Land is secondhand goods. Record the supplier’s name and address, date, description, quantity, and price paid. You must make a payment before you claim, whichever accounting basis you use. More: GST on second hand goods NZ and associated persons GST.
IS 25/22 (GST: secondhand goods input tax deduction, issued 11 November 2025) limits an associated purchase. If the supplier did not also get the goods from an associated person, the recipient’s input tax is the lowest of the tax fraction of the supplier’s original purchase price, the tax fraction of what the recipient pays, and the tax fraction of open market value. If the supplier’s original purchase price was zero, for example a trust distribution, the input tax deduction is zero. Goods acquired before 1 October 1986 by an associated person can block the claim altogether. Inland Revenue’s special supplies page also limits later associated sales in a chain to the GST a registered person in that chain actually charged.
IR375’s associated persons output tax is the other side. If you supply to an associated person who can claim GST, you account for GST on the amount received. If they cannot claim, you account for the greater of open market value or the amount charged. Jones, Smith and Brown sell a piano to Lee: $1,500 sale, $2,000 market. GST registered Lee: $195.65 ($1,500 × 3 ÷ 23). Unregistered Lee: $260.87 on the $2,000 market value.
Tax fraction: Inland Revenue’s charging GST page (last updated 1 April 2026) says registered persons charge 15% on most taxable supplies, either $100 plus GST ($115) or GST inclusive (3/23 of $100 is $13.04). The change in use disposal formula uses the same 15% of the GST exclusive amount, or 3/23 of the GST inclusive amount. Add or strip 15% on a figure that is already in the GST net with the free GST calculator.
Keep the house out if you can
IR375 is blunt on home office capital. Claims for the purchase of the property itself, or capital improvements to your home, may make a future sale of the property subject to GST on the full sale amount. You can elect to treat principally private assets as non-taxable. Inland Revenue’s GST adjustments page limits that election to goods such as land, dwellings, and vehicles, where no past GST deduction has been claimed (excluding non-integral deductions), the goods were not acquired or used for the main purpose of making taxable supplies, and they were not acquired as zero-rated supplies (with a debit adjustment option for that last case).
Rebecca’s Inland Revenue example: GST registered farm, farmhouse mainly a private residence, seller was not GST registered so the purchase was not zero-rated, no GST claimed on the house or capital improvements. She can elect to treat a future sale of the farmhouse as a non-taxable supply. Farming land stays in the GST net. She can still claim part of rates, insurance, and utilities on the percentage of the farmhouse used for taxable supplies. Farming walkthrough: farming and agriculture GST.
Gavin’s example is the zero-rated trap. He is GST registered and buys a holiday home for $1 million from another GST registered person. The sale is zero-rated. Main purpose is private recreation, with some short stay. He can keep a future disposal non-taxable by returning output tax of $150,000 (the nominal GST that would have been charged if the purchase had not been zero-rated). If use does not change, he will not have to charge GST on a later sale. Compulsory land zero rating: zero rating of land transactions NZ.
Use case: Tauranga designer, old laptop
Situation: Hypothetical GST registered sole trader introduces a laptop already owned, GST exclusive cost well under $10,000, principal purpose now taxable work. GST: Phil’s pattern on Inland Revenue’s page: full GST if principal purpose is taxable supplies, even with some private use. Action: Keep the original invoice. Do not expect a later top up if use changes. Principal purpose has no later adjustments.
Use case: Ben’s car, use goes to 100%
Situation: Inland Revenue’s Ben example. GST registered business, car claimed on 80% estimated business use, later used 100% for the business. GST: He can claim the remaining 20% in the first GST return after his balance date. He still monitors use. Action: That is a change in use adjustment, not a second invoice from the dealer. Wash-up formula if the new percentage is permanent: (full GST amount × new percentage) minus actual deduction.
From 1 April 2024 Inland Revenue’s mixed-use assets page says the mixed-use asset rule will not apply to short stay accommodation, boats, and aircraft. Apply the general GST apportionment rules fairly and reasonably. You can keep using the old mixed-use method as a fair and reasonable method without approval. Detail: GST on mixed use assets in NZ and GST private use, stock, samples, giveaways.
Melissa’s disposal example on the change in use page: car $46,000 inclusive of $6,000 GST, 70% claimed ($4,200), later sold for $30,000 GST inclusive. Final adjustment: 3/23 × $30,000 × (1 minus 0.7) = $1,174. Property developers have a cap: the final adjustment cannot exceed the tax fraction of the purchase price when the asset was first acquired. Emily’s Inland Revenue numbers show that cap in action ($21,120). Vehicles: GST on motor vehicles. Claiming generally: claiming GST NZ.
The “get the GST back on the house” trap
PropertyTalk threads still treat a GST refund on a home or a lifestyle block as free cash if you invent a taxable activity. IR375 requires a taxable activity carried on continuously or regularly, supplying goods or services for consideration. Inland Revenue will not register you just because you want input tax. If you do claim GST on the dwelling, a later sale in the taxable activity can bring output tax on the full amount unless an election, a wash-up, or an exempt dwelling rule actually applies. Forum talk about selling the personal house into a company to “get GST” is the associated secondhand goods file, with IS 25/22 limits, not a 15% windfall.
FAQs
Can you claim GST when you introduce a private asset into a GST registered business?
Yes, to the extent the asset is used (or available to use) to make taxable supplies. Inland Revenue’s GST adjustments page (last updated 31 March 2026) says you may purchase goods for the business or introduce already owned goods and services into the business, then adjust for business use versus private use. Inland Revenue’s GST guide IR375 (March 2026) says you acquire a good or service when you either purchase it or introduce it into your taxable activity.
Is selling your car to your own company a secondhand goods GST claim?
It can be, if the company is GST registered, pays for the goods, and the goods are secondhand (previously used by someone else, including land). Inland Revenue’s special supplies page says you may be able to claim a credit when you buy secondhand goods from a non-registered seller, and you must make a payment before you claim. If buyer and seller are associated persons, IS 25/22 (issued 11 November 2025) limits the claim to the lowest of the tax fraction of the supplier’s original purchase price, the tax fraction of what the recipient pays, and the tax fraction of open market value.
Will putting the family home into the GST net help cashflow?
Often it does the opposite. IR375 warns that claims for the purchase of the property itself or capital improvements to your home may make a future sale subject to GST on the full sale amount. Inland Revenue lets you elect to treat land, dwellings, and vehicles that were not acquired or used for the main purpose of making taxable supplies as non-taxable, if no past GST deduction has been claimed (apart from non-integral deductions). Rebecca’s farmhouse example on the GST adjustments page is that election in plain English.
Read Inland Revenue’s GST adjustments for business, private and exempt use, change in use adjustments, mixed-use assets page, claiming GST, charging GST, special supplies (secondhand goods), GST guide IR375 (March 2026), IR546 (March 2026), and Tax Technical IS 25/22. Publisher path: About Us and Contact Us.
Last verified 4 September 2026 against Inland Revenue GST adjustments (31 March 2026), change in use (1 April 2026), claiming GST (1 April 2023), charging GST (1 April 2026), mixed-use assets, special supplies, IR375 March 2026, Tax Technical IS 25/22 (11 November 2025) and the 2012 logbook article, and IR375 registration at $60,000. Ads may fund this free site. Not tax advice. Figures are working papers, not an Inland Revenue assessment.