NZ changes to GST imports to affect our exporters

Editor:  In a similar fashion, the New Zealand government has issued a discussion paper, entitled “GST: Cross border services, intangibles and goods”, the upshot of which is to levy GST on imports under the current threshold of NZ$400.

The proposed rules would require offshore suppliers to register and return GST, when they supply services and intangibles, which exceed a given threshold in a 12-month period, to New Zealand-resident consumers.

The paper proposes that there would be a wide definition of “services”, which would include digital services (such as video, music, and apps and other software downloads).

It would also include traditional services such as consultancy fees for legal, accounting, engineering, and other services.

At the present time there is no proposed start date, although the NZ government may decide to align their start date with Australia’s proposed start date for GST on imports under $1,000 of 1 July 2017.

Taxpayers can apply to the ATO for a market value ruling


The ATO has issued an information sheet to help taxpayers get their property valuations right.

They say that practitioners or their clients can apply for a market value private ruling, by either:

  • asking the ATO to provide a valuation (they will be required to pay for the work of the valuer); or
  • providing the ATO with a valuation and asking them to confirm it – this generally costs less, provided the valuation meets the ATO’s requirements.

There are several advantages to requesting a market value private ruling, as opposed to obtaining a private valuation, as a market value private ruling:

  • gives the client greater certainty about their tax matters;
  • is binding advice that the client can rely on;
  • is completed by a professional valuer and the client can be involved in the selection and appointment of that valuer; and
  • removes the risk of providing the ATO with a valuation that does not meet its requirements, which could lead to further costs for the client.

ATO warns about doing your own valuation

According to the ATO, taxpayers who undertake their own valuations – or use valuations from people without adequate qualifications – risk incorrectly reporting their tax, and may be liable to pay administrative penalties.

However, taxpayers who use a qualified valuer or equivalent professional for taxation purposes will generally not be liable to a penalty if they have provided the valuer with accurate information should the valuation ultimately prove to be deficient.

Pay GST instalments quarterly and report annually

Editor:  The ATO has advised that practitioners and their clients can opt to pay GST quarterly, and only report annually.

This option is available to all businesses with a turnover of $2 million or less.
If a business elects to take this option, it pays a quarterly GST instalment that the ATO works out (the taxpayer can vary it) and reports its actual GST information annually on an Annual GST return.

Editor:  If you would like to discuss this option, please call our office.

GIC and SIC rates for the 2015 December quarter

The ATO has published the 2015 December quarter rates for the General Interest Charge (GIC) and the Shortfall Interest Charge (SIC):

GIC annual rate 9.14%
GIC daily rate 0.02504109%
SIC annual rate 5.14%
SIC daily rate 0.01408219%