Goods and Services Tax (GST) is a broad-based consumption tax levied on most goods and services supplied in New Zealand. At a flat 15%, it is one of the cleanest VAT-style systems in the world — there is no reduced rate, no luxury rate, and relatively few exemptions. Whether you are a sole trader quoting a client, an e-commerce seller calculating landed costs, or an accountant reconciling a GST return, this calculator handles both directions:
- Add GST — you know the GST-exclusive (net) price and need the GST-inclusive (gross) total to put on an invoice.
- Remove GST — you have a GST-inclusive figure (for example, from a receipt or bank statement) and need to isolate the net amount and the embedded GST for your accounts.
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How NZ GST works
NZ GST was introduced by the Goods and Services Tax Act 1985 and originally set at 10%. It rose to 12.5% in 1989, then to the current 15% on 1 October 2010. Unlike the tiered VAT systems common in the EU, New Zealand deliberately chose a single-rate design to minimise complexity and compliance costs.
A registered business charges GST on its sales (output tax) and claims GST back on its business purchases (input tax). The net difference — output tax minus input tax — is paid to Inland Revenue (IRD) on the GST return. If input tax exceeds output tax (common for exporters who are zero-rated), IRD issues a refund.
The registration threshold is NZ$60,000 of taxable turnover in any 12-month period. Below that, registration is optional.
The two formulas
Adding GST to a net amount:
Gross = Net x 1.15
GST component = Net x 0.15
Removing GST from a gross amount:
Net = Gross / 1.15
GST component = Gross - Net
The “3/23 rule” is a well-known IRD-endorsed mental shortcut for extracting GST from a GST-inclusive price: multiply the gross by 3 and divide by 23. For example, NZ$230 x 3 / 23 = NZ$30 GST. It works because 15/115 simplifies to 3/23.
Worked example — freelance invoice
Suppose you are a Wellington-based graphic designer and your services are worth NZ$1,500 (net, before GST). You are GST-registered, so you must add 15%:
| Component | Calculation | Amount |
|---|---|---|
| Net (your fee) | — | NZ$1,500.00 |
| GST @ 15% | NZ$1,500 x 0.15 | NZ$225.00 |
| Invoice total (gross) | NZ$1,500 + NZ$225 | NZ$1,725.00 |
Now flip the scenario: your client sends you a receipt for NZ$1,725 and asks what the GST component was:
| Component | Calculation | Amount |
|---|---|---|
| Gross (receipt total) | — | NZ$1,725.00 |
| Net (ex-GST) | NZ$1,725 / 1.15 | NZ$1,500.00 |
| GST extracted | NZ$1,725 - NZ$1,500 | NZ$225.00 |
NZ GST rate reference
| Rate | Category | Typical supplies |
|---|---|---|
| 15% | Standard | Retail goods, restaurant meals, professional services, commercial rent, accommodation, software subscriptions, domestic transport |
| 0% | Zero-rated | Exports of goods and services, sale of a going concern, certain land (farmland between GST-registered parties), international transport |
| Exempt / outside scope | Non-registered or exempt | Supplies by businesses under the NZ$60,000 threshold; residential rent; donated goods sold by charities under certain conditions |
Zero-rated supplies are not the same as exempt. A zero-rated supplier still files GST returns and can claim input credits — the rate is simply 0%. An exempt or unregistered supplier cannot claim input credits and does not charge GST at all.
When to use zero-rated (0%)
Select the zero-rated band in this calculator if you are:
- Pricing an export of physical goods shipped outside New Zealand.
- Quoting for exported services (services performed for an overseas customer who is not in NZ at the time of supply).
- Working through the GST position on a going-concern sale where both parties are GST-registered.
- Checking whether a land transaction qualifies for zero-rating under section 11(1)(mb) of the GST Act.
In all these cases the math is trivial (GST = NZ$0), but the calculator confirms the gross equals the net — handy for double-checking invoice figures before filing your GST return with Inland Revenue.