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

  • enacted
55 Section 20 amended (Calculation of tax payable)

(1)

In section 20(3)(d)(vi), replace “supply; and” with “supply:”.

(2)

After section 20(3)(d)(vi), insert:

(vii)

does not apply to the supply of a contract of insurance that is zero-rated under section 11A(1)(x); and

(3)

After section 20(3)(db), insert:

(dc)

an amount of output tax charged on a supply of remote services to the extent that the supplier has, in relation to the supply, incurred liability for, returned, and paid a consumption tax in another country or territory, when the remote services are—

(i)

physically performed in New Zealand; and

(ii)

supplied to a non-resident person in New Zealand who is not a registered person; and

(4)

After section 20(3JB), insert:

(3JC)

For a supply of remote services to which section 11A(1)(j) or (x) applies, if the recipient of the supply—

(a)

estimates at the time of acquisition that the percentage intended use of the services is less than 95%, then the recipient must, on acquisition—

(i)

identify the nominal amount of tax (the nominal GST component) that would be chargeable on the value of the supply, as if the value were equal to the consideration charged for the supply, at the rate set out in section 8(1); and

(ii)

based on the percentage intended use of the services, account for output tax under subsection (4) for the proportion of the nominal GST component for any non-taxable use of the services:

(b)

determines at the end of an adjustment period that the percentage actual use of the services is less than 95%, then the recipient must, at the end of the adjustment period—

(i)

identify the nominal GST component that would have been chargeable on the value of the supply, as if the value were equal to the consideration charged for the supply, at the rate set out in section 8(1); and

(ii)

based on their percentage actual use of the services, account for output tax under subsection (4) for the proportion of the nominal GST component for any non-taxable use of the services:

(c)

is required to account for output tax under paragraph (a) or (b), then the recipient must, for later adjustment periods, make adjustments under the apportionment rules set out in sections 20G and 21 to 21H in relation to the taxable supply referred to in paragraph (a) or (b).

(5)

After section 20(4B), insert:

(4C)

For a supply of remote services to which section 8(3)(c) applies, a recipient of the supply is denied a deduction of input tax in relation to the supply unless the recipient has obtained a tax invoice under section 24(5B).

(4D)

Subsection (4C) does not apply to a supply of remote services that is treated by section 5B as being made by the recipient and the recipient has accounted for the output tax charged on the supply.