Taxation (Residential Land Withholding Tax, GST on Online Services, and Student Loans) Bill

  • enacted
50 New section 8B inserted (Remote services: determining residence and status of recipients)

After section 8A, insert:

8B Remote services: determining residence and status of recipients

(1)

Subsection (2) applies to determine whether a supply is made in New Zealand under section 8(3)(c), or for the purposes of sections 10(14B), 11A(1)(j), and 60C, when remote services are supplied to a person resident in New Zealand.

(2)

A supplier must treat the recipient of the supply as a person resident in New Zealand if 2 of the following items are non-contradictory and support the conclusion that the person is resident in New Zealand:

(a)

the person’s billing address:

(b)

the internet protocol address of the device used by the person or another geolocation method:

(c)

the person’s bank details, including the account the person uses for payment or the billing address held by the bank:

(d)

the mobile country code of the international mobile subscriber identity stored on the subscriber identity module card used by the person:

(e)

the location of the person’s fixed land line through which the service is supplied to them:

(f)

other commercially relevant information.

(3)

For the purposes of subsection (2),—

(a)

if, in addition to having 2 non-conflictingnon-contradictory items from the list in subsection (2) supporting residence in New Zealand, a supplier also has at least 2 non-conflictingnon-contradictory items that support residence in a country other than New Zealand, the supplier must choose the evidence that is more reliable to determine a recipient’s residence:

(b)

the Commissioner may prescribe the use of another method to determine a recipient’s residence, or may agree with the supplier on the use of another method, if a supplier is unable to establish a recipient’s residence by 2 non-conflictingnon-contradictory items from the list in subsection (2).

(3B)

In prescribing or agreeing to the use of an alternative method under subsection (3)(b), the Commissioner may take into account the following:

(a)

the nature of the supply, including, for example,

(i)

whether the supply is made in a low-value high-volume digital context:

(ii)

whether the supply is a single instance or a supply made as part of a continuing relationship between the recipient and the supplier:

(b)

the availability to the supplier of information about the recipient’s residence.

(4)

Subsection (5) applies to determine the treatment of a supply to a registered person of remote services described in section 8(3)(c) when section 8(4) applies, and for the purposes of sections 11A(1)(j) and 60C.

(5)

Having established the New Zealand residence of a recipient of a supply of services under subsection (2), a supplier must treat the recipient as not being a registered person unless the recipient—

(a)

notifies the supplier that they are a registered person:; or

(b)

provides their registration number or New Zealand business number.

(6)

For the purposes of subsection (5), the Commissioner may agree with the supplier onprescribe the use of another method to determine whether the supply is made to a registered person, or may agree with the supplier on the use of another method to determine whether the supply is made to a registered person.

(7)

In prescribing or agreeing to the use of an alternative method under subsection (6), the Commissioner may take into account the following:

(a)

the nature of the supply, including, for example, whether the supply is of services that are purchased only by a registered person in the course or furtherance of their taxable activity:

(b)

the value of the supply, including, for example, whether the supply is of a value that would be expected to be received only by a registered person in the course or furtherance of their taxable activity:

(c)

the terms and conditions related to the provision of the services, including, for example, whether the supply is of services that may be licensed for use by a registered person.