New GST Rules for Online Platform Users
Have you heard about the changes to GST for users of online platforms like Airbnb, Uber, and other services? Having come into effect on the 1st of April 2024, they alter the way that people must treat their income from these sources for GST purposes.
Here’s the breakdown:
- If you take bookings through your own platform, there are no changes. GST-registered individuals will continue reporting income to the IRD with GST applied.
- If you use third-party platforms to take bookings (i.e bookabach, airbnb, uber), you will be required to make adjustments to how you record and code your income.
If you’re GST-registered:
- The first step will be to notify the platform that you’re registered. They may have been in touch regarding this.
- Rather than reporting GST on the income received from the platform, you will need to begin reporting it as a zero-rated supply.
- Your expense claims won’t change; you will still be able to claim the GST back.
If you’re not GST-registered (earning less than $60,000):
- Online marketplace operators will collect GST at the standard 15% rate. They will pay 6.5% to IRD on your behalf and will pass on 8.5% to you. This flat-rate method recognises the GST you pay as part of your expenses without you having to be GST registered.
While the changes are fairly straightforward, if you’re earning money on one of these platforms you should check in with your accountant to ensure that you’ve integrated them correctly and your GST returns are in order.
The Malloch McClean team can help you to stay on top of this and other tax obligations! Talk to us about what you need and let’s build a smarter, better business together.