{"id":11121,"date":"2023-11-15T12:43:11","date_gmt":"2023-11-14T23:43:11","guid":{"rendered":"https:\/\/ontrackbookkeeping.co.nz\/?p=11121"},"modified":"2024-03-18T15:01:19","modified_gmt":"2024-03-18T02:01:19","slug":"understanding-the-difference-no-gst-vs-zero-rated-gst-transactions","status":"publish","type":"post","link":"https:\/\/ontrackbookkeeping.co.nz\/understanding-the-difference-no-gst-vs-zero-rated-gst-transactions\/","title":{"rendered":"Understanding the difference: \u2018no GST\u2019 vs. \u2018zero-rated GST\u2019 transactions"},"content":{"rendered":"<p><span style=\"font-weight: 400;\">If you\u2019re a business owner or taxpayer in New Zealand, you\u2019ve likely encountered terms like \u2018no GST\u2019 and \u2018zero-rated GST\u2019 transactions. These terms refer to specific tax treatments under the Goods and Services Tax (GST) system in New Zealand. In this blog post, we\u2019ll break down these concepts in simple terms to help you understand the difference.<\/span><\/p>\n<h2><span style=\"font-weight: 400;\">No GST transactions<\/span><\/h2>\n<p><span style=\"font-weight: 400;\">No GST transactions are those where the goods or services provided are exempt from the Goods and Services Tax. In other words, no GST is added to the price of the goods or services. These transactions are outside the scope of GST, and as a result, there is no GST charged.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Some examples of \u2018no GST\u2019 transactions include:<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">The sale of residential property.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Certain financial services.<\/span><\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\">In these cases, GST does not apply, making them \u2018no GST\u2019 transactions.<\/span><\/p>\n<h2><span style=\"font-weight: 400;\">Zero-rated for GST transactions<\/span><\/h2>\n<p><span style=\"font-weight: 400;\">Zero-rated for GST transactions are transactions where GST is applied at a rate of 0%. This means that GST is charged, but at a 0% rate, effectively making the transaction non-taxable.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Zero-rated transactions are typically related to exports or international sales. For example, when a New Zealand business sells goods or services to overseas customers, they may be zero-rated for GST. This means that although GST is applied, the rate is 0%, making the transaction tax-free.<\/span><\/p>\n<h3><span style=\"font-weight: 400;\"><br \/>\nIn summary, the key difference lies in how GST is applied:<\/span><\/h3>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">\u2018No GST\u2019 transactions are completely exempt from GST.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">\u2018Zero-rated GST\u2019 transactions have GST applied at a 0% rate, making them non-taxable.<\/span><\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\">Understanding these distinctions is essential for complying with New Zealand\u2019s GST regulations and ensuring accurate financial transactions for your business.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">So, even if the product you\u2019re supplying your client is zero-rated for GST, you still have to charge them GST \u2013 just at a rate of 0%. This means they pay nothing in GST, but you still have to record these sales in your regular GST returns.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">It is peculiar and perplexing, but there you go. If you want to know more about GST or anything else related to your business and tax, <a href=\"mailto:di@ontrackbookkeeping.co.nz\">we\u2019re happy to answer your questions<\/a>.<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>If you\u2019re a business owner or taxpayer in New Zealand, you\u2019ve likely encountered terms like \u2018no GST\u2019 and \u2018zero-rated GST\u2019 transactions. These terms refer to specific tax treatments under the Goods and Services Tax (GST) system in New Zealand. In this blog post, we\u2019ll break down these concepts in simple terms to help you understand &hellip; <a href=\"https:\/\/ontrackbookkeeping.co.nz\/understanding-the-difference-no-gst-vs-zero-rated-gst-transactions\/\">Continued<\/a><\/p>\n","protected":false},"author":11,"featured_media":8418,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","enabled":false}}},"categories":[131,221,240],"tags":[125],"jetpack_publicize_connections":[],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v22.6 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Understanding the difference: \u2018no GST\u2019 vs. \u2018zero-rated GST\u2019 transactions - Ontrack Bookkeeping Ltd<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/ontrackbookkeeping.co.nz\/understanding-the-difference-no-gst-vs-zero-rated-gst-transactions\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Understanding the difference: \u2018no GST\u2019 vs. \u2018zero-rated GST\u2019 transactions - Ontrack Bookkeeping Ltd\" \/>\n<meta property=\"og:description\" content=\"If you\u2019re a business owner or taxpayer in New Zealand, you\u2019ve likely encountered terms like \u2018no GST\u2019 and \u2018zero-rated GST\u2019 transactions. 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