GST CHANGES 1 April 2024

Online Platform Implications 

Big news on the horizon! Starting 1st April 2024, there are some changes coming to the Goods and Services Tax (GST) scene that you might want to know about. One of the main changes is that popular online platforms like Airbnb, Uber or BookaBach will now be collecting GST on all the services they offer. That means whether you're catching a ride, ordering food, or booking accommodation, GST will be part of the deal, no matter if you're registered for GST or not.

And it's not just the base cost of the service. Additional charges, like cleaning fees for holiday rentals you book through these platforms, will also have GST tagged on.

 Let's break down what this means for you:

If you're a GST-registered Airbnb host and you're renting out your place for $100 a night, your guests will now pay $115 after the 15% GST is added. But here's the twist: you won't actually pocket that extra $15. Instead, you'll declare the $100 as sales on your GST return, and since it's categorized as a zero-rated supply, you won't have to pay any GST on it. You can still claim back GST on stuff you've bought though.

But if you're not registered for GST, things change a bit. Your guests will still pay $115 for that $100-per-night stay, but now $6.50 (6.5% of $100) goes to the taxman, and the remaining $8.50 (8.5% of $100) is a flat-rate credit that comes back to you.  When it comes to tax time, make sure you're keeping track of all your income and expenses (the platform provider should provide reports) as those flat-rate credits don’t get included in your income tax return.

For the big players out there, there might be a chance to work around these new rules by chatting with the folks who run the online platforms. Just make sure you keep the lines of communication open and let them know where you stand with GST.

If you have any questions or need more clarification, please give us a call at 09 636 3332. We're here to help!