GST Reverse Charge Calculator NZ 2026

This calculator works out whether you need to self-assess GST under the reverse charge mechanism in section 8(4B) of the GST Act 1985, and how much that self-assessed GST comes to. The reverse charge catches New Zealand businesses that buy services from overseas suppliers, such as consulting, software subscriptions, marketing, IP licensing or legal and accounting work, when the buyer does not make at least 95% taxable supplies. This is the situation banks, insurers, financial service providers and residential landlords often find themselves in, because their exempt supplies mean an equivalent NZ-sourced service would carry GST they cannot fully recover. You enter the value of the imported services, the type of service, whether you are GST-registered and your annual turnover, your intended taxable use percentage at the time you acquired the service, and your actual taxable use percentage over the adjustment period if it has changed. The calculator tests both the 95% intended-use threshold at acquisition and the 90% actual-use threshold that can trigger a later adjustment, then returns the non-taxable use percentage, the GST output you must self-assess, and the net GST cost after allowing for the input tax credit on the taxable portion. It also flags if the reverse charge pushes your turnover over the $60,000 GST registration threshold. Figures are indicative only; confirm your position with IRD or an accountant before filing.

Updated  Tests sections 8(4B) and 9(2)(h) of the GST Act 1985 (reverse charge for imported services).
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Imported service details

$
The contract price you paid the overseas supplier. They typically don't charge NZ GST because they're not NZ-registered.

Your business profile

$

Use of the imported services

%
The percentage you expected the services to be used for making taxable supplies (excluding exempt supplies and private use). Banks/insurers/residential landlords often have low taxable use percentages.
%
Leave at intended % if unknown. Used for the secondary 90% threshold test.

Why the reverse charge exists

When a NZ business buys services from a NZ supplier, the supplier charges 15% GST. If the buyer makes mostly exempt supplies (banks, insurance, residential rent), they cannot recover the GST and bear it as a real cost. Without the reverse charge, the same business could buy the equivalent service from an overseas supplier (who doesn't charge NZ GST) and avoid the tax. The reverse charge levels the playing field by requiring the NZ recipient to self-assess GST when they make mostly exempt supplies.

The two thresholds

Primary test - 95% intended use at acquisition

If at the time you acquire the imported service you intend to use it for less than 95% taxable supplies, the reverse charge applies. You self-assess GST on the full value of the services in the GST return covering the time of supply. You can then claim a GST input credit for the taxable use portion under the apportionment rules.

Secondary test - 90% actual use during adjustment period

If at acquisition your intended taxable use was 95% or more (so no reverse charge applied initially), but your actual taxable use over the adjustment period drops below 90%, a deemed self-supply is triggered. The time of supply is the last day of the adjustment period in which use dropped. You self-assess GST on the value of the services for that period.

When the reverse charge does NOT apply

  • The recipient is not GST-registered AND turnover (including imported services) is below $60,000
  • The recipient makes 95% or more taxable supplies and actual use stays at 90% or above
  • The supply would not be a taxable supply if it were made in NZ
  • The services are GST-exempt under the standard GST Act exemptions

Common scenarios

  • Bank using offshore IT consultants: Bank makes mostly exempt financial services supplies, intended taxable use under 95%. Reverse charge applies to the full consulting fee.
  • Residential landlord buying overseas property management software: Residential rental is exempt, so taxable use of the software is low. Reverse charge applies if landlord is GST-registered.
  • SaaS company buying overseas marketing: If the SaaS company makes 95%+ taxable supplies, no reverse charge needed initially. Secondary test only triggers if actual taxable use drops below 90%.

Sources

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Frequently asked questions

What is the GST reverse charge in NZ?

The reverse charge is a self-assessment GST mechanism under section 8(4B) of the GST Act 1985. When a NZ recipient imports services from overseas and intends to use them for less than 95% taxable purposes, the recipient must self-assess GST on the value of the services as if they had supplied the services to themselves. This prevents NZ businesses making exempt supplies (banks, financial services) from gaining a tax advantage by sourcing services offshore where no NZ GST is charged.

When does the 95% threshold apply?

At the time you acquire the imported service, you assess your intended taxable use percentage. If you intend to use the service less than 95% for taxable supplies, the reverse charge applies immediately and you self-assess GST on the full value. If you intend 95% or more taxable use, no reverse charge is needed at acquisition - but a secondary 90% test applies later if your actual use drops.

When does the 90% threshold trigger a later adjustment?

If your original intended taxable use was 95% or more (so no reverse charge was needed at acquisition), but your actual taxable use over the adjustment period drops below 90%, a deemed self-supply is triggered. The time of supply is the last day of the adjustment period in which use dropped below 90%. You then self-assess GST on the value of the services and apply the apportionment rules for the appropriate portion.

Do I need to register for GST if I receive imported services?

If you are not GST-registered and the value of imported services subject to the reverse charge takes your annual turnover (including the imported services) above the $60,000 GST registration threshold, you must register for GST. This catches non-resident-facing businesses (often financial services or residential property businesses) that source services from offshore. Once registered, you self-assess GST under the reverse charge and account for it through your normal GST returns.