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Working for yourself

A side hustle, a gig, a channel or a trade: what to charge, what to put aside for tax, and when GST starts to apply.

23 situations worked through, 20 of them with the sums shown. Each one links to the guide that sets out the rules behind it, and that guide is where any rate or threshold is kept current.

The people in these situations are illustrations written to show how the rules land on somebody, not real customers and not case histories. The arithmetic is real and the rules are real; the names and the circumstances are made up to teach.

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Content Creator Tax NZ

Aroha - a small hobby channel

Aroha posts gaming clips for fun. Over the year she gets about $150 in small, irregular tips and no sponsorships. She has a full-time job with PAYE tax already deducted.

  1. Content income: about $150, small and irregular
  2. No brand deals, no gifted products, no profit motive yet
  3. Other (non-reportable) income under $200 for the year

Likely still a hobby, and under the $200 filing point

💡 Watch the trend

Aroha is probably fine for now, but the moment she signs a sponsorship, receives gifted gear to review, or her tips become regular, the activity tips into taxable territory and she should start keeping records and declaring it.

The same calculation on its own, with others like it

Jayden - a full-time Twitch streamer (business)

Jayden streams full time. This year he earns $48,000 from subscriptions, bits and ad revenue, plus $6,000 in sponsorships, and his gear, software and internet cost $19,000.

  1. Total income: $48,000 + $6,000 = $54,000
  2. Allowable expenses: -$19,000

Taxable profit: $35,000

⚠️ Jayden becomes a provisional taxpayer

His residual income tax of about $5,033 is just over $5,000, so he becomes a provisional taxpayer next year and pays that tax in instalments. His turnover of $54,000 is under $60,000, so he does not have to register for GST yet, but he is close, so he should watch it.

The same calculation on its own, with others like it

Lucy - an influencer with gifted products (GST)

Lucy is a lifestyle influencer. She earns $44,000 in cash sponsorships and receives gifted products she reviews with a fair market value of $9,000. Her expenses are $6,000.

  1. Cash sponsorships: $44,000
  2. Gifted products at market value: $9,000
  3. Total income: $53,000
  4. Expenses: -$6,000

Taxable profit: $47,000

⚠️ The tax on gifts is paid in cash

Lucy owes income tax on the $9,000 of products even though she received no cash for them. She needs enough actual money set aside to pay the tax on the non-cash income, which is a common cash-flow trap for influencers.

The same calculation on its own, with others like it

Tom - earning from an overseas platform

Tom lives in Auckland and earns the New Zealand dollar equivalent of $50,000 from a United States based platform, paid into an overseas account. The platform withheld some United States tax.

  1. Tom is in New Zealand all year, so he is a NZ tax resident
  2. NZ residents are taxed on worldwide income
  3. He declares the $50,000 in his New Zealand return

Foreign tax already paid may be claimed as a credit to avoid double tax

💡 Declare it, then claim the credit

Tom cannot leave the $50,000 out just because it was earned and paid overseas. He includes it as income in New Zealand and claims a foreign tax credit for the United States tax already withheld, so he is not taxed twice on the same income.

The same calculation on its own, with others like it

Gig Driver Money Guide

Ana - part-time driver under $60k (flat-rate credit)

Ana drives for Uber part time. Over 12 months the value of her rides is $20,000. She is not registered for GST because she is well under $60,000.

  1. Marketplace collects 15% GST: $20,000 × 15% = $3,000
  2. Paid to Inland Revenue (6.5%): $20,000 × 6.5% = $1,300
  3. Flat-rate credit passed to Ana (8.5%): $20,000 × 8.5% = $1,700

Ana keeps her $20,000 of fares plus a $1,700 flat-rate credit

The same calculation on its own, with others like it

Sina - full-timer over $60k who registers

Sina drives full time and her fares reach $75,000 over 12 months, so she must register for GST. She tells the marketplace she is registered. She has $18,000 of GST-inclusive business costs (fuel, vehicle costs and phone) for the year.

  1. Sales through the marketplace: $75,000, zero-rated, so GST charged = $0
  2. GST on her costs (the GST fraction is 3/23 of a GST-inclusive amount)
  3. $18,000 × 3 ÷ 23 = $2,348

GST refund to Sina: about $2,348

💡 Registration can suit high-expense drivers

Because her marketplace supplies are zero-rated, Sina has no output GST to pay but can still claim the GST on her costs. For a driver with heavy fuel and vehicle bills, that can be worth more than the flat-rate credit, though it also means filing regular GST returns.

The same calculation on its own, with others like it

Ravi - kilometre-rate expense claim

Ravi drives a petrol car and uses the kilometre-rate method. Over the year his car travels 20,000 kilometres in total, and his logbook shows 80% of that travel is for driving work.

  1. Tier One: first 14,000 km × 80% business = 11,200 business km
  2. 11,200 × $1.20 = $13,440
  3. Tier Two: remaining 6,000 km × 80% business = 4,800 business km
  4. 4,800 × $0.37 = $1,776

Total vehicle expense claim: $13,440 + $1,776 = $15,216

⚠️ The 14,000 km line uses total travel

The switch from Tier One to Tier Two happens once the vehicle passes 14,000 kilometres of total travel for the year, counting both business and private use, not 14,000 business kilometres. Apply the business percentage within each tier.

The same calculation on its own, with others like it

Mele - provisional tax trigger

In her first full year of full-time driving, Mele's profit after expenses is $48,000. She has no other income and no tax was deducted during the year.

  1. First $15,600 @ 10.5% = $1,638
  2. Next $32,400 ($15,601 to $48,000) @ 17.5% = $5,670
  3. Total income tax: $1,638 + $5,670 = $7,308

Residual income tax: $7,308 (more than $5,000)

The same calculation on its own, with others like it

GST on Uber and Airbnb

Ari, a part-time Uber driver (not GST-registered)

Ari drives for Uber and earns $30,000 of fares over the year. He is well under the $60,000 threshold and is not GST-registered.

  1. GST collected by Uber: $30,000 × 15% = $4,500
  2. Paid to Inland Revenue by Uber: $30,000 × 6.5% = $1,950
  3. Flat-rate credit passed to Ari: $30,000 × 8.5% = $2,550

Ari keeps his fares plus the $2,550 flat-rate credit

The same calculation on its own, with others like it

Mia, an Airbnb host (not GST-registered)

Mia rents out a spare room and a sleepout on Airbnb, earning $25,000 for the year. She is not GST-registered and is under the $60,000 threshold.

  1. GST collected by Airbnb: $25,000 × 15% = $3,750
  2. Paid to Inland Revenue by Airbnb: $25,000 × 6.5% = $1,625
  3. Flat-rate credit passed to Mia: $25,000 × 8.5% = $2,125

Mia keeps her hosting income plus the $2,125 flat-rate credit

💡 Income tax is still due

Mia does not register for GST because she is under $60,000. But her $25,000 of short-stay income is taxable, so she declares it in her tax return and can claim a share of her expenses, such as cleaning, linen, power and rates for the space she rents out.

The same calculation on its own, with others like it

Jordan, a host who crosses $60,000 (GST-registered)

Jordan runs several short-stay properties and earns $90,000 a year through Airbnb and Bookabach. Because this is over $60,000, he must register for GST.

  1. Airbnb still collects 15% on the bookings
  2. In Jordan's GST return, the marketplace supplies are zero-rated
  3. Jordan does not receive the 8.5% flat-rate credit
  4. Jordan claims GST back on his costs instead
⚠️ No double dipping

Because Jordan is registered, he cannot also keep the flat-rate credit. If a marketplace passes him one by mistake, he must return it to Inland Revenue with a debit adjustment in his GST return. Registered sellers claim real costs instead of the flat-rate credit.

The same calculation on its own, with others like it

Sam, a food-delivery courier with a day job

Sam has a salaried job taxed through PAYE and delivers food part-time in the evenings, earning $12,000 a year from a delivery platform. He is not GST-registered.

  1. GST collected by the platform: $12,000 × 15% = $1,800
  2. Paid to Inland Revenue by the platform: $12,000 × 6.5% = $780
  3. Flat-rate credit passed to Sam: $12,000 × 8.5% = $1,020

Sam keeps his delivery earnings plus the $1,020 flat-rate credit

💡 Two income sources, one tax return

Sam's salary is already taxed through PAYE, but his $12,000 of delivery income is not. He declares the delivery income in an IR3 and pays income tax on it, on top of his salary. The flat-rate credit only sorts out GST, not his income tax.

The same calculation on its own, with others like it

Selling Online and Tax

Priya - clearing out the wardrobe (not taxable)

Priya has a big clear-out and sells her old clothes, a bike and some furniture on online marketplaces over a few months. She raises about $1,900 in total.

  1. Items sold: her own used personal possessions
  2. Purpose: decluttering, no intention to make a profit
  3. She paid more for most items new than she sold them for

Taxable income: $0. This is a private sale of personal items.

💡 Why it is tax-free

Priya did not buy these things to resell. She is turning her own belongings back into cash, so there is no taxable activity, no matter how much a single item sold for.

The same calculation on its own, with others like it

Sam - flipping sneakers on the side (taxable)

Sam has a $55,000 salary and spends weekends buying limited-edition sneakers to resell at a profit online. Over the year he sells $28,000 worth. The shoes cost him $18,000, and he spends $2,000 on fees and postage.

  1. Sales (turnover): $28,000
  2. Cost of sneakers: -$18,000
  3. Fees and postage: -$2,000

Taxable profit: $8,000

⚠️ This is clearly taxable

Sam buys stock specifically to resell for a profit, so the $8,000 is taxable income he must declare, even though it is a side activity. His turnover of $28,000 is under $60,000, so he does not have to register for GST, and his extra tax of $2,400 is under $5,000, so he is not yet a provisional taxpayer. If his trading grows, both of those thresholds could catch him.

The same calculation on its own, with others like it

Mere - candle making that grew into a business (taxable, GST)

Mere started making candles for friends, then began selling them online and at markets. This year her sales reached $65,000. Her materials, stall fees, packaging and platform fees came to $28,000.

  1. Sales: $65,000
  2. Expenses: -$28,000
  3. Taxable profit: $37,000
  4. Tax: $15,600 × 10.5% = $1,638
  5. plus ($37,000 - $15,600) × 17.5% = $3,745

Income tax: about $5,383

💡 Mere crosses two thresholds

Her turnover of $65,000 is over $60,000, so she must register for GST, charge 15% on her candles and file GST returns. Her income tax of about $5,383 is over $5,000, so she becomes a provisional taxpayer for the following year and pays that tax in instalments. She must also keep her records for 7 years.

The same calculation on its own, with others like it

Josh - selling up before moving overseas (not taxable)

Josh is moving to Australia and sells his car, his furniture and most of his household goods on Marketplace before he leaves. He raises about $14,000.

  1. Items sold: his own car and household possessions
  2. Purpose: he is leaving the country, not trading
  3. He owned and used these items himself

Taxable income: $0. These are private sales of personal assets.

💡 Big totals can still be tax-free

Even though Josh raised $14,000, none of it is taxable. The amount is high because he is selling everything at once, not because he is trading. New Zealand has no general capital gains tax on private assets like this, so a one-off gain on his own car or furniture is not taxed.

The same calculation on its own, with others like it

Side Hustle Tax NZ

Dan, 27, Christchurch

Bought electronics from AliExpress and resold on an auction site. "Just a hobby." Revenue: $45,000/year.

This one turns on the rules rather than on a calculation, so there are no sums to show.

Priya, 30, Wellington

Freelance graphic designer. Day job: $62,000. Freelance: $25,000/year.

This one turns on the rules rather than on a calculation, so there are no sums to show.

Steve, 45, Hamilton

Plumber doing cash side jobs. Undeclared income: ~$30,000/year for 5 years.

This one turns on the rules rather than on a calculation, so there are no sums to show.

Can I Afford to Hire?

Tom hires his first employee at $68,000

Tom runs a services business at a 45% gross margin. He is turning away work and wants to hire someone at $68,000.

  1. Salary: $68,000.00
  2. Employer KiwiSaver at 3.5%: $2,380.00
  3. ACC work levy at 1.6%: $1,088.00
  4. Cash employment cost: $71,468.00
  5. Tools and equipment, first year: $3,500.00
  6. Software, phone, insurance, space and training: $7,800.00

First year total: $82,768.00, which is 21.7% above the wage

💡 The cash question is separate from the profit question

Tom's hire is profitable in year one by $5,951.23, and that is not the same as being affordable. He pays the salary fortnightly from week one and collects the extra revenue on his normal payment terms, so the cash gap runs for months before it closes. He needs enough buffer to fund roughly eight months of a person who is not yet paying for themselves. Our business cash buffer calculator sizes that, and our new hire ramp-up cost calculator models the productivity curve behind the week 37 figure.

The same calculation on its own, with others like it

How Much Should I Pay Myself?

Anahera, sole director of a services company

Anahera runs a small consultancy through a company. Revenue is $285,000. After all costs except her own pay, the business makes $132,000. She has been taking $60,000 in drawings, recorded as a shareholder salary at year end, because that is what she needed to live on when she started four years ago.

  1. Comparable employed roles advertise at $95,000 to $115,000
  2. She works around 45 hours a week, slightly above a standard week
  3. Market rate for the role as she performs it: $105,000

The business has been getting $45,000 of labour a year for nothing

💡 When the ceiling is below the market rate

If Anahera's sustainable ceiling had been $70,000 against a $105,000 market rate, the honest conclusion is not that she should take $70,000 and feel fine about it. It is that the business generates $35,000 a year less than the labour it consumes, and the response is a pricing or capacity change rather than a pay decision. Our minimum price calculator and overhead recovery rate calculator address that directly.

The same calculation on its own, with others like it

How to Price a Job

Pricing a job from scratch

Note that the labour figure is the cost of the hour, not the charge-out rate. It should include employer KiwiSaver, ACC and the loading that covers leave, which our true cost of employee calculator works out.

  1. Labour: 38 hours at $42.00 direct cost = $1,596.00
  2. Materials at cost: $4,200.00
  3. Subcontractor at cost: $2,800.00
  4. Plant and equipment: 3 days at $180.00 = $540.00

Direct cost: $9,136.00

The same calculation on its own, with others like it

Should I Delegate or Do It Myself?

Three tasks, three different answers

the owner above, effective rate $61.97, spends 18 hours a week on general admin, bookkeeping and quoting. That is 936 hours a year, or 40.0% of their entire working year .

  1. 312 hours a year, costing $10,920.00 to have done
  2. Your rate $61.97 against market $35.00: you save $26.97 an hour
  3. Handover: 12 hours of your time, costing $743.59

Saves $8,413.33 a year, paying back the handover in 1.1 months. Delegate.

💡 The freed hours only count if you use them

All of this assumes the 572 hours go into work that earns at least your effective rate. If they go into working fewer hours, that is a perfectly good reason to delegate, but call it what it is: you are buying your time back, not making money. If they go into more of the same low-value work, you have paid $10,920 to be equally busy. Decide what the hours are for before you hand the task over.

The same calculation on its own, with others like it

Other situations
Saving and investing   Running a business   Buying a first home   Running a household   Debt you cannot pay   Scams, faulty goods and your rights   Changing or losing a job   Separation, death and estates   Understanding your pay and tax   Owning a rental or holiday home  
Every situation

Situations are taken from the guides listed above and are worked examples for education, not advice. Figures used in an example were current when the guide was written; the guide holds the maintained figure. Last reviewed 2026-09-07. See also the arithmetic on its own, every question the site answers and the guides.