Iain Blakeley

Barrister - Tax Expert - Business Adviser - Director, Professional, Practical, Fast, Affordable

Hidden GST traps
GST derails another property sale

GST derails another property sale

Recently from the Court of Appeal, another example of how GST can derail what should have been a simple property sale. Y & P NZ Ltd v Yang Wang & Chen Zhang [2017] NZCA 280 is a decision from the Court of Appeal about whether caveats registered by the...

It wouldn’t happen in New Zealand – or would it?

An Australian court says a taxpayer has not commenced a subdivision activity until they have the funds needed to purchase the land. The costs spent beforehand on planning permits and market valuations were preliminary or preparatory to starting any business. That's...

Charges for failing to turn up to parties

A parent in the UK invoiced the parents of a five year old GBP15.95 because their son failed to turn up to a birthday party after they had accepted the invitation on his behalf. See the story here: http://www.bbc.com/news/uk-england-cornwall-30876360 They're...

12 GST thoughts of Christmas

12 GST thoughts of Christmas: 1. There's no GST on gifts (so Santa is probably not GST registered). 2. GST registered businesses can claim back the GST on gifts they buy for staff, suppliers and customers. 3. If you buy someone a gift voucher for Christmas it's quite...

IRD comments on short term Christchurch rentals

Inland Revenue's latest Business Tax Update reminds us people renting out houses in Christchurch short-term have to pay income tax on the rent, less deductions. It's a pity they don't mention GST because that's more interesting. The update is here:...

Certainty in construction

Planning ahead and attention to detail in contractual documentation are essential for retirement village operators wanting clarity of what GST costs they are up for. That was the key GST message at this week's Retirement Villages Association finance forum focussing on...

GST and tips

Some discussion lately on tips and GST. It's become more common for eftpos devices to offer customers a tipping option when paying their bills. The GST implications of this are more complex than the old-fashioned method of slipping a bit of extra cash to the staff...

Taxing energy drinks unconstitutional

A recent decision in France has concluded a government tax on energy drinks contravenes the country's constitution. Under France's tax laws a tax was imposed on energy drinks with at least 220 mg of caffeine per 1,000 ml. The tax was challenged and the Constitutional...

Visiting sports teams

The recent publicity about AFL players being pinged for income tax as "entertainers" when they played the Anzac Day matches here is interesting. See here: http://www.3news.co.nz/Wellington-AFL-game-hit-with-tax/tabid/415/articleID/355731/Default.aspx Like everything...

NZ businesses are getting it wrong

I'm seeing increasing evidence of misunderstanding over how the zero rating rules apply. From 1 April 2014 non-resident businesses can register for GST in NZ under a new system which allows them to claim GST refunds on business related costs. Historically a business...

GST for schools – consultation

Inland Revenue has released a draft Public Ruling on the GST treatment of payments by parents to state schools. This is a re-issue of previous rulings with just a few changes to reflect recent developments in GST law. If you want to comment on the draft ruling you...

VAT and online sales

This is a very good item on the wider business implications of proposed changes in Europe to the VAT treatment of online digital media sales. http://performance.ey.com/2014/02/20/vat-change-online-sales-just-tax-concern/ Cheers Iain

Bodies corporate and GST

Brian Fallow's opinion piece in today's Herald on residential bodies corporate and GST is timely. See here: http://www.nzherald.co.nz/opinion/news/article.cfm?c_id=466&objectid=11231055 This issue baffles me. Why is it so complicated and why is it taking so long...

Grant versus fee!

The Woking Museum and Arts and Crafts Centre is a charity set up to "advance the education of the public in local national and international history and arts and crafts". In 2003 it entered into an agreement with the Woking Borough Council [In the UK] to "provide...

12 GST thoughts of Christmas

12 GST thoughts of Christmas: 1. There's no GST on gifts (so Santa is probably not GST registered). 2. GST registered businesses can claim back the GST on gifts they buy for staff, suppliers and customers. 3. If you buy someone a gift voucher for Christmas it's quite...

Buying and selling houses

If you're buying and selling houses on a regular basis be careful of GST. The Tax Review Authority recently backdated GST registration for a couple's family trust to 1999 because they traded 11 residential properties in 12 years. The case is reported at: Case 5/2013...

Importing costs

NZ Customs have a feature on their website called "What's my duty?". It's a great tool for calculating how much GST and other charges you might be up for when you buy stuff on line. Here it is: http://www.whatsmyduty.org.nz/ The calculator isn't intended to be a final...

Exporters beware!

There's no GST on exports, right? Wrong! Sometimes GST does apply to exports. Here's an example: NZ Ltd agrees to sell products to UK Ltd. UK Ltd is going to use the parts in the creation of a sculpture in the UK. NZ Ltd invoices UK Ltd and receives payment before the...