Quick Summary
A 'taxable activity' for GST registration in New Zealand is an activity carried on continuously or regularly, which involves or is intended to involve the supply of goods or services to another person for consideration. A business must have a taxable activity to register for GST, whether mandatory or voluntary.
Details
Defining 'Taxable Activity'
The concept of a 'taxable activity' is fundamental to GST registration in New Zealand. It's not just about turnover; it's about the nature of the activities your business undertakes.
- IRD's Definition: A 'taxable activity' is defined as:
- An activity that is carried on continuously or regularly.
- It involves or is intended to involve the supply of goods or services.
- These supplies are made to another person for consideration (i.e., for money or another form of payment).
- Key Elements:
- Continuity/Regularity: It implies an ongoing or repeated nature, not just a one-off transaction.
- Supply of Goods/Services: This covers a wide range of commercial activities.
- Consideration: There must be an exchange of value for the goods or services provided.
- Importance: You must be conducting a taxable activity to be eligible to register for GST, regardless of whether your registration is mandatory (above $60,000 turnover) or voluntary (below $60,000 turnover). If you're unsure if your activities qualify, the IRD offers guided help tools.
Source: GST guide (IR375)