Once you register for GST, 15% of most of your sales belongs to Inland Revenue, and you can claim back the GST on most business costs. That shifts how you price, how you invoice and how much cash you need to keep aside. Here's how registration and filing work in practice.
When does a business need to register?
In broad terms, registration is generally required when taxable turnover was or is expected to be at least $60,000 in any 12-month period. A business can also choose to register voluntarily below that level, but voluntary registration creates real obligations: charging GST where required, keeping GST records, filing returns and paying any net amount due.
Turnover is not the same as profit. A business with high sales and slim margins can still cross the threshold quickly. Watch the rolling 12-month picture rather than waiting for the end of a financial year.
What changes after registration?
Your invoices need to make the GST treatment clear, and your prices need a deliberate approach. Decide whether your customer-facing price includes GST or whether GST is added. Tell regular customers before the first GST-inclusive invoice so the change does not feel like an unexpected price rise.
You also need a dependable record of:
- taxable sales and the GST collected
- business purchases and the GST that may be claimable
- credit notes, refunds and adjustments
- private or mixed-use costs
- imported goods, exports or other transactions with special treatment
How does a GST return work?
A return compares the GST collected on taxable supplies with the GST you can claim on eligible business purchases for the period. The result may be payable or refundable. That result is not the same as profit, and it can be quite different from the movement in your bank account.
Before filing, reconcile the accounting records, check unusual transactions and look for missing invoices. A return prepared from unreconciled bank activity is a guess with a due date attached.
Filing periods and due dates
You can file monthly, two-monthly or six-monthly. Six-monthly filing is only available if your turnover is under $500,000, and monthly filing is required once turnover is over $24 million. Two-monthly is the most common choice for small businesses.
Returns and payments are generally due on the 28th of the month after the period ends. There are two exceptions: the period ending 30 November is due on 15 January, and the period ending 31 March is due on 7 May.
Build a cash habit around GST
If GST is regularly payable, move the GST portion of customer receipts into a separate savings account or reserve. Review the likely amount before the period closes, not on the filing day. If a payment will be difficult, file on time and contact Inland Revenue or your adviser promptly about the balance and possible options.
The best GST system is a small, repeatable routine: current books, clear coding, a review before filing and the next deadline visible.