Quick Summary
No, for goods and services valued at $20,000 or less, you generally do not need to make GST adjustments in New Zealand if the change in use adjustment is less than 10% and the value of the adjustment is $1,000 or less. This rule, effective from 1 April 2023, simplifies compliance for minor fluctuations.
Details
Simplified Rules for Minor Change in Use
To ease the administrative burden on New Zealand businesses, the Inland Revenue Department (IRD) introduced a de minimis rule for GST adjustments from 1 April 2023, specifically for minor changes in asset use.
- Applicable Assets: This rule applies to goods and services valued at $20,000 or less (presumably excluding GST, aligning with other thresholds).
- Conditions for No Adjustment: An adjustment for a change in use is not required if both of the following criteria are met:
- The change in use is less than 10% of the asset's original taxable use (e.g., if business use changes from 80% to 75%, that's a 5% change).
- The monetary value of the adjustment itself (the amount of GST that would be claimed or repaid) is $1,000 or less.
- Benefit: This avoids the need for businesses to make small, frequent adjustments for slight variations in how an asset is used, allowing them to focus on more significant changes.
Source: GST guide (IR375)