Register for GST in NZ: $60,000, last year or next

$60,000. Nearly every summary of that figure in New Zealand describes it as last year's turnover, and nearly every summary is half right. Inland Revenue's own wording carries two limbs, joined by an "or": you must register where "your turnover was at least $60,000 in the last 12 months, or you expect it will be at least $60,000 in the next 12 months".

The second limb is the one that catches trade businesses, because it is forward-looking. A builder with $41,000 behind him who signs a $58,000 renovation in March has, on the day he signs, an expectation of turnover over $60,000 in the coming twelve months. He is liable then — before the first progress payment, before the deposit, before any of that money exists.

Turnover, not profit, and not the financial year

Two clarifications do most of the work here.

It is turnover from a taxable activity, before costs. A business that invoiced $72,000 and spent $28,000 on materials is over the line, even though what it kept was $44,000. Materials, subcontractors, vehicle running costs and wages do not come off first. The figure is what you charged.

It is a rolling twelve months, not a tax year. Nothing in the test is tied to 31 March. The window moves with every month that passes, so a business can cross the line in August on the strength of a busy October behind it, and drop back under it later without that undoing anything.

There is also a second trigger that people forget exists: Inland Revenue lists registration as required where "you carry out a taxable activity and you add GST to the price of the goods or services you sell". Charge it and you have to be registered for it. A quote that says "plus GST" from a business with no GST number is not a pricing convention, it is a statement about a registration that has to be real.

What actually changes on the day you register

Three things, and only the first is obvious.

You charge 15 per cent. New Zealand has had a single GST rate of 15 per cent since 1 October 2010 under s 8(1) of the Goods and Services Tax Act 1985, up from 12.5 per cent. There is no reduced rate for renovation work and no construction reverse charge, so every job you bill carries it.

You claim it back on what you buy. This is the half of registration that makes it worth choosing voluntarily. The GST in a $9,200 ute, in a compressor, in every trade-counter run, becomes recoverable.

Your documents change. Once registered you are providing taxable supply information, and your GST number becomes mandatory on anything over $200 — a document without it is short of a requirement the customer's bookkeeper will notice. The detail of what each band needs is in Sample invoice, New Zealand: the document that stopped being a tax invoice.

Who you sell to decides whether registering hurts

This is the part that a threshold article usually leaves out, and it is the part a trade business feels.

If your customers are businesses — main contractors, property managers, body corporates — GST is invisible to them. They claim back what you charge. Registering costs you paperwork and gains you input credits, and that is the whole ledger.

If your customers are households, GST is a real price increase. A $20,000 bathroom becomes $23,000, and the homeowner cannot claim a cent of it. Nothing in the Act lets you soften that, and absorbing it means giving up thirteen per cent of every gross dollar — $2,608.70 out of a $20,000 job, because the GST inside a GST-inclusive price is fifteen one-hundred-and-fifteenths of it, not fifteen per cent.

That arithmetic is worth doing before you register voluntarily, and it is the reason the answer differs between a commercial subcontractor and a domestic maintenance business with the same turnover.

Registering moves the $30,000 residential line

Here is an interaction that neither authority connects, because they are two different authorities.

MBIE's guide for contractors says, in terms: "When you're pricing a job, the price should be the total cost of all the building work (including supplies, fixtures and fittings) plus GST." The consumer-protection duties in residential building work attach "for residential building work costing $30,000 or more (including GST)" — a written contract, and before signing, the consumer protection standard checklist and a disclosure statement about your business.

So take a $28,000 kitchen for a homeowner. Unregistered, there is no GST to add and the job sits below the line. Registered, the same work at the same net price is $32,200 including GST and sits above it — written contract required, checklist and disclosure statement required before signing, and "you can be fined $2,000 for not supplying homeowners with the consumer protection standard checklist or disclosure statement if you are required to."

This is not a quirk of the guidance, it is written into the machinery: regulation 4(1) of the Building (Residential Consumer Rights and Remedies) Regulations 2014 sets the prescribed minimum price at $30,000 inclusive of goods and services tax, and regulation 4(2) sends you to s 10(2) of the Goods and Services Tax Act 1985 to work an estimate out. A threshold defined by reference to the GST Act moves with your GST status. The limit of the point is worth stating in the same breath: MBIE's guide is written for a contractor who charges GST and does not spell the unregistered case out, so the safe working rule is to hand over the checklist and the disclosure statement on any domestic job priced anywhere near $30,000 — two documents, and the question disappears. What the guide does answer flatly is the workaround people reach for first: "Attempting to avoid your obligations by splitting work into separate contracts of less than $30,000 will not be to your advantage." The full set of duties at that line, with both regulations quoted, is in Residential building contracts: the $30,000 line.

One contract, three dates, and $9,782.61

A one-man building business in Tauranga, not registered, with $41,000 of billings behind it.

14 February 2026. Turnover for the previous twelve months stands at $41,000. No registration required, and none in place. Correct.

17 February 2026. He signs a kitchen and bathroom renovation for a private homeowner at $75,000. The contract says $75,000 and does not mention GST, because he is not registered and there is nothing to mention. On this date the second limb of the test is met: he now expects turnover of at least $60,000 in the next twelve months. Liability to register arises here, not when the money arrives.

2 September 2026. The job is finished and paid. He is registered, late, and the GST has to be accounted for on the supply. The contract price is what the customer agreed, so the $75,000 is treated as the consideration and the GST sits inside it: $75,000 × 15 ÷ 115 = $9,782.61.

That $9,782.61 does not come from the homeowner, who signed for $75,000 and owes $75,000. It comes out of the margin, and on a renovation of that size the margin is not usually $9,782.61 wide. Had the contract been written on 17 February as "$75,000 plus GST — $86,250 including GST", the same job would have carried the same tax and cost him nothing.

The date that mattered was the day he signed, and the number that mattered was one he had not earned yet.

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Position as at 24 September 2026, checked against Inland Revenue's registration guidance and MBIE's contractor guide. This describes the rules and is not tax advice. The $60,000 figure sits in the Goods and Services Tax Act 1985 and is not indexed, so it does not drift quietly — it moves only when Parliament moves it, and ird.govt.nz/gst/registering-for-gst carries the figure in force. The $30,000 residential line is a separate number under separate legislation and has its own review cycle; check both before pricing a domestic job near either.

What Zirko does here: a business below the registration threshold is set that way once, and every document it issues then goes out without a GST line, with the note text that its own country prescribes — and for New Zealand that is deliberately none, because no note text is prescribed here, unlike seven of the countries Zirko operates in. Switch the business to registered and the GST number and the fifteen per cent appear on the documents from that day forward. What Zirko does not do: it does not watch your rolling turnover and will not tell you that you have crossed $60,000. The forward-looking limb of that test is an expectation about work you have not done yet, and no software can read a contract you are about to sign.