NZ GST-Free, Zero-Rated and Exempt Guide

Not every sale in New Zealand carries 15% GST. Some supplies are zero-rated, some are exempt, and the difference matters when you claim GST back on your costs. This guide explains each treatment in plain terms before you use a GST calculator.

Quick checker

Zero-rated is not the same as exempt

Zero-rated supplies are still part of the GST system. You charge GST at 0% and you can generally keep claiming GST on the costs of making those supplies. Exempt supplies sit outside the GST system: you charge no GST and you generally cannot claim GST back on related costs. That one difference is why getting the treatment right matters.

Examples of each treatment

Exports of goods and many international services are zero-rated, as are sales of land between GST-registered parties and businesses sold as going concerns. On the exempt side, IRD lists supplies such as financial services, donated goods sold by non-profit bodies, residential rents, penalty interest and fine metals. The full lists live on IRD’s website, and edge cases are common, so treat examples as a starting point rather than a ruling.

Worked example: mixed supplies in one month

Manaia runs an online store in Wellington. In March her GST-inclusive sales are $92,000 to New Zealand customers, $20,000 of exports to Australia and $3,000 of exempt financial service fees.

She charges 15% GST on the domestic sales only: $92,000 x 3/23 = $12,000 of GST. The exports are zero-rated, so no GST is charged, but she can still claim GST on the freight and packaging. The $3,000 of exempt fees carries no GST, and she cannot claim GST on the costs tied to those fees. Getting this split right is the difference between a correct return and an IRD adjustment.

A practical way to work out the right treatment

When a sale does not look like a standard 15% supply, work through these questions before you invoice:

What exactly am I supplying, and who is the customer?
Where will the goods or services be used or enjoyed?
Does IRD’s zero-rated or exempt list describe this supply precisely?
If the sale mixes treatments, can I split the invoice line by line?

If you are still unsure, check IRD’s guidance or ask your accountant. Choosing a treatment because a transaction sounds similar to an example is how mistakes happen.

NZ GST-free, zero-rated and exempt FAQs

Is there really such a thing as GST-free in New Zealand?
Not as an official IRD category. Australians use the term GST-free, but in New Zealand a supply is either taxable at 15%, zero-rated at 0%, or exempt. This page covers all three so nothing slips through.

What is the difference between zero-rated and exempt?
Zero-rated supplies are taxed at 0% but stay inside the GST system, so you can generally claim GST on related costs. Exempt supplies are outside the system: no GST is charged and GST on related costs generally cannot be claimed.

Do I charge GST on exports?
Most exports of goods and many exported services are zero-rated, so you charge 0% GST. Keep the export documentation, because that is what proves the zero-rating if IRD asks.

Can I claim GST back on costs for exempt supplies?
Generally no. GST on costs that relate to exempt supplies cannot be claimed. Where costs relate to both taxable and exempt supplies, you may need to apportion them, so good records matter.

IRD: Zero-rated supplies · IRD: Exempt supplies · NZ GST Calculator · GST Return Calculator · GST Registration Threshold Guide