GST rules for properties in New Zealand

Updated 5 days ago | 7 min read time
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Marketplace rules mean that all reservations made via our platform for properties in New Zealand are subject to 15% Goods and Services Tax (GST) from 1 April 2024. We’ll be responsible for collecting and paying this GST on all reservations for partners who haven’t opted out. Partners who do opt out remain responsible for their own GST obligations.


What’s in this article:


What the rules mean for GST-registered partners

We’ll treat you as having opted out of the marketplace rules. That means nothing will change for you and you’ll remain responsible for your own GST obligations.

Unless you let us know otherwise, you agree and confirm to us that you choose to continue to be liable for the payment of GST on accommodation services that you provide, and responsible for all GST obligations.

This includes providing taxable supply information to your guests. If you believe you don’t meet the criteria for opting out or if you don’t want to, you can update your GST settings and opt back in in the extranet – you can find out how later in this section.

You’re eligible to opt out from the marketplace rules if you meet one of these criteria:

  • You offer or expect to offer more than 2,000 nights of accommodation on one marketplace in a 12-month period
  • You’re not an individual and your total turnover in a 12-month period is more than NZ$500,000

If the criteria to opt out don’t apply to you or if you choose to opt back in, here’s what will happen:

  • We’ll be responsible for collecting and paying 15% GST on the room or unit rate for all your completed reservations made via our platform.
  • You’ll no longer need to account for the 15% on your supplies of reservations made via our platform.
  • We’ll provide taxable supply information to your guests on the reservation confirmation they receive from us.
  • If you receive gross payouts from us or if you collect payments directly from your guests, we’ll send you a monthly payment request for the GST on your reservations that we’ve paid to Inland Revenue.
  • If you receive net payouts from us by bank transfer, we’ll withhold GST from your monthly payouts and pay this to Inland Revenue.
  • If there's a delay to us being able to implement this solution, we may still need to recover the GST from you that we'll be required to pay to Inland Revenue. If this is the case, we'll let you know by 30 April 2024.

For more information on the criteria for opting out of the marketplace rules, take a look at the Inland Revenue website. If you believe you don’t meet the criteria for opting out or if you don’t want to, you can update your GST settings and opt back in the extranet. Here’s how:

  1. Sign in to the extranet.
  2. Click on Finance and then click on Finance settings.
  3. In the General finance section, click on Goods and services tax.
  4. Click on Edit details.
  5. Check your GST registration status, and update it if needed.
  6. Under Would you like to opt out of the marketplace rules?, select No.
  7. Enter or update your IRD number.
  8. Click on Save.

Check GST settings


What the rules mean for non-GST-registered partners

We’ll be required to collect 15% GST on the room or unit rate for all your completed reservations made via our platform on or after 1 April 2024. In line with the flat-rate credit scheme, we’ll then pay 8.5% of the total value of the reservation (excluding GST) to you and the remaining 6.5% to Inland Revenue. We’ll do this unless you’re working with a listing intermediary who has contacted us, in which case the listing intermediary will pay you the flat-rate credit.

In practice, since we won’t withhold the GST amount directly from your guests, each month we’ll send you a payment request for the GST on your reservations that we’ve paid to Inland Revenue.

If there's a delay to us being able to implement this solution, we may still need to recover the GST from you that we'll be required to pay to Inland Revenue. If this is the case, we'll let you know by 30 April 2024.


Tax rate settings in the extranet

To prepare for this change, we’ll update your tax rate settings in the extranet from 1 April 2024:

  • Whether or not you're registered for GST, we'll update your tax rate in your room or unit rate setup to 15%.
  • If you currently have 15% VAT (instead of GST) set up as included in your room or unit rates, we won’t make any changes.
  • If you don't currently have any tax setup at all, we'll add 15% VAT as included in your existing room or unit rates. You can then update your room or unit rates to reflect this if you wish.

Updating your IRD number and GST registration status

Whether or not you’re registered for GST, we’re also required to collect your IRD number (tax file number). Please provide us with this in the extranet and also check that your GST registration status is up to date. Here’s how:

  1. Sign in to the extranet.
  2. Click on Finance and then click on Finance settings.
  3. In the General finance section, click on Goods and services tax.
  4. Click on Edit details.
  5. Check your GST registration status and marketplace rules opt-out status, and update them if needed.
  6. Enter or update your IRD number.
  7. Click on Save.

Check GST settings


Other things to keep in mind

There are a few other things for our accommodation partners to keep in mind:

  • If your GST registration status changes, please let us know as soon as possible. If you become GST registered and you don’t let us know right away, you may receive a flat-rate credit from us that you’re not entitled to, and this could lead to penalties and adjustments in your GST return.
  • If you're non-GST-registered, we'll be required to continue to charge GST on our commission invoices for the services we provide to you. This isn’t affected by the new rules on GST on your reservations.
  • If you work with a listing intermediary, such as a property management company who lists your property on our platform, please contact them to make sure you both understand these new GST rules and what they mean for you.

Specific rules for listing intermediaries

Specific marketplace rules apply where listing intermediaries who list accommodation services on our platform on behalf of properties, such as property management companies, are involved.

If you’re a listing intermediary, please also contact your properties to make sure they understand these new GST rules and what they mean for them, and to check that they have updated their GST registration status in the extranet.

According to the marketplace rules, a listing intermediary is a GST-registered person who meets both of these criteria:

  • Lists short-stay accommodation on an online marketplace on behalf of an underlying supplier.
  • Enters into an agreement, in their own name, with an online marketplace to list or advertise the short-stay accommodation.

Unless you let us know that you're a listing intermediary and that these specific rules should apply, we'll treat each of your properties individually based on their own GST registration statuses.

 

As a listing intermediary, you may be eligible to opt out of the marketplace rules for all of your properties, if you meet all of these criteria:

  • You’re resident in New Zealand
  • You enter into agreements with more than one marketplace to list or advertise short-stay accommodation on behalf of your properties
  • You enable or facilitate the supply of the short-stay accommodation using an electronic system that can facilitate and automatically manage the reservations made by guests
  • You agree in writing with the marketplace that you’re liable for paying tax on supplies of short-stay accommodation on that marketplace

To find out more about the criteria for listing intermediaries to opt out of the marketplace rules, take a look at the Inland Revenue website.

If you’re eligible to opt out and you choose to, you’ll be responsible for paying 15% GST on the room or unit rate for all your properties’ completed bookings to Inland Revenue, unless your properties have opted out. You’ll also be responsible for administering the flat-rate credit for any of your properties that are non-GST-registered.

Even if you opt out, we’ll still provide taxable supply information to guests on the booking confirmation they receive from us.

Here’s how to opt out as a listing intermediary if you’re eligible:

  • If some of your properties are non-GST-registered or if they don't meet the criteria for opting out, please let us know via your regular Booking.com contact. We’ll need you to confirm this request by sending us a message from your extranet inbox. If you do this, please don't adjust the GST registration status of your non-GST-registered properties in the extranet. 
  • If all of your properties are GST-registered and they meet the criteria for opting out, please contact them and make sure their GST registration status and marketplace rules opt-out status are up to date in the extranet. In this situation, your properties will remain responsible for collecting and paying GST and providing taxable supply information to their guests.

If you don’t or can’t opt out of the marketplace rules

If you're acting as a listing intermediary but you don’t meet the criteria for opting out or if you don’t want to, please let us know via your Booking.com contact.

In this situation, here’s what will happen:

  • We’ll collect 15% GST on the room or unit rate for completed reservations for all properties you work with as a listing intermediary, and pay it to the Inland Revenue Department.
  • You’ll be responsible for applying the flat-rate credit scheme to any non-GST registered properties you work with.

If you don’t let us know that you’re a listing intermediary, we’ll pay the flat-rate credit where necessary based on the GST registration status of each individual property. In a situation like this where you won’t be paying the flat-rate credit to your properties, you shouldn’t then claim a credit adjustment on your GST return.

For more information about the marketplace rules for listing intermediaries, take a look at the Inland Revenue website. If you have further questions, we recommend that you contact your tax advisor or accountant.


FAQs

  • If the guest keeps the original reservation and simply makes changes, we’ll apply GST based on the rate in your settings on the date the reservation was first made. But if the original reservation is cancelled and then the guest makes a new one after 1 April 2024, we’ll consider this as a reservation under the new marketplace rules and we’ll be required to apply 15% GST and pay it to the Inland Revenue unless  you’ve agreed to opt out of the marketplace rules.

  • For more information, take a look at the Inland Revenue website. If you’re unsure which tax rules and rates might apply to your property, we recommend that you contact your tax advisor or accountant.

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