New Zealand introduces global GST reform related to electronic marketplaces

New Zealand introduces global GST reform related to electronic marketplaces

New Zealand has expanded electronic marketplace (”e-marketplace”) rules with effect from April 2024. The Taxation Act 2023 addresses the intermediation of services such as accommodation, ride-sharing, and food delivery. Liability for tax collection and remittance for these listed services will be placed on the marketplace, as long the service is performed, provided, or received in New Zealand. This type of service provided through an e-marketplace will be subject to GST regardless of whether the underlying supplier is GST registered or not, and irrespective of the residency of the e-marketplace for GST purposes.

The changes contained in the Taxation Act affect the scope of taxable events, GST rates, tax collection, input tax, GST returns, taxable supply information, and recordkeeping for enumerated services.


As of April 1, 2024, these new rules will apply to non-resident and resident electronic marketplaces that provide services listed within the Act.

Marketplace and Supplier Obligations for Listed Services

Listed Services

The listed services addressed by the Taxation Act of 2023 include the following:

  • accommodation
  • ride-sharing and ride-hailing services
  • delivery services for food, beverages, or both

Listed services also include other services closely connected to them, supplied by underlying suppliers, and advertised, listed, or made available by electronic marketplaces (e.g., cleaning services).

Electronic Marketplaces

An e-marketplace will be considered to be the supplier of listed services if the marketplace -

  • authorizes a charge for the provision of services to the recipient
  • authorizes the supply of services to the recipient, and/or
  • directly or indirectly imposes a term or condition on the supply of services

Underlying Suppliers

Underlying suppliers must provide the marketplace operator with their name, tax file number, GST registration status, and any changes to these details. Marketplaces can rely on the information provided by the supplier. However, the tax authority (IRD - Inland Revenue Department) has announced that it is working on creating a GST registration verification service for electronic marketplaces.

If the underlying supplier is GST registered, the supply to the marketplace will be treated and reported on the GST return as a Zero-Rated Sale. If it is not GST registered, the supply to the platform will be treated as not subject to GST.

Flat-Rate Credit

A flat-rate credit scheme will be introduced. The e-marketplace will pass on a portion of the GST collected on the supply of listed services to underlying suppliers who are not required to register. The GST Act determines the flat-rate credit (8.5%) by reference to the average amount of input tax recovered by GST-registered suppliers of listed services.

There is no explicit timing requirement for marketplace operators to pass on the flat-rate credit. The GST Act seeks to ensure sufficient flexibility to allow these marketplaces to pass on this credit along with other amounts due to the underlying supplier.

If an underlying supplier is subject to the flat-rate credit scheme, the marketplace must deduct input GST on that credit amount. At least monthly, the platform must also inform the supplier of the amount of flat-rate credit passed on.

Underlying GST-registered suppliers will continue to account for input tax on their expenses in their GST returns. However, they will no longer be responsible for recording GST output tax on the supply of listed services, as this will be done by e-marketplaces unless they have opted out of the marketplace rules.

Underlying suppliers who are not required to register, but do not want to be subject to the flat-rate credit scheme, can apply for voluntary standard registration.

Opt-Out rules

Some underlying suppliers can opt out of the marketplace rules and therefore be responsible for collecting and remitting GST. The opt-out rules came into effect on March 31, 2023.

If underlying suppliers make more than NZD 500,000 in taxable supplies in a 12-month period, they can apply unilaterally, but they must inform the e-marketplace. When an e-marketplace receives such a notification, it does not need to verify the information and can rely on what has been communicated.

Underlying suppliers and marketplaces can enter into an agreement to apply these rules when the supplier reaches one of these scenarios -

  • Provide (or expect to provide) 2,000 nights of taxable accommodation in 12 months
  • Meet some criteria set by the tax authority (which have yet to be published) related to the size, scope, and nature of the services.

In any case, marketplace operators are not required to monitor these requirements.

Invoice (Taxable Supply Information)

Contrary to the general rules, e-marketplaces must provide taxable supply information (invoice) to the GST-registered recipient of the listed service in all circumstances, without the need for a request.

There is no requirement to issue an invoice for zero-rated sales between underlying suppliers and e-marketplaces.

If an opt-out agreement is in place, the documentation provided to the recipient must identify the underlying supplier, not the e-marketplace, as the supplier.

GST registration

Marketplace operators will only be required to collect and remit GST on supplies of listed services if their total supplies in New Zealand, including those services, exceed or are likely to exceed the GST registration threshold of NZD 60,000 in any 12-month period.

GST rates

Unlike the intermediation of remote services and the supply of goods, there are no special rules that allow a different GST treatment for listed services, so the GST rate will always be 15%.

Facilitation Fee

The facilitation fee is the amount charged by the marketplace to the underlying supplier for connecting with the customer.

If the platform is tax resident in New Zealand, the fee will be subject to GST at a rate of 15%, regardless of the tax residency of the supplier.

Remote Service rules apply if the electronic marketplace is not a tax resident of the country. This means that if the underlying supplier is a New Zealand resident but not GST-registered, the e-marketplace must charge GST at a rate of 15% on the facilitation fee. However, if the supplier is GST-registered, this fee is not subject to GST, although the platform may treat it as a zero-rated sale.

GST returns

Non-resident electronic marketplaces treated as listed service suppliers will have a quarterly GST return. These will be their taxable periods and filing and payment due dates:

  • 1 January to 31 March → 7 May
  • 1 April to 30 June → 28 July
  • 1 July to 30 September → 28 October
  • 1 October to 31 December → 28 January of the following year

However, resident marketplaces will be subject to the regular rules for GST return periods and calendars.


Unlike resident marketplaces, non-resident marketplaces will not need to apply to the tax Authority for permission to keep records outside New Zealand or in a language other than English.

They will also be able to account for GST on listed services in a foreign currency at the time of supply.

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