Amount (excl. GST)
$5,000.00
GST (15%)
$750.00
Net Payable
$5,750.00
Invoice Composition
GST on Invoices
If you are GST registered (required when turnover exceeds $60,000), you must charge GST at 15% on your invoices. You can enter amounts either inclusive or exclusive of GST and the calculator will compute the other.
Withholding Tax
Some payers (e.g., labour-hire firms) may deduct withholding tax from your invoice before paying. The rate depends on whether you have provided your IRD number and tax code. Schedular payments may attract withholding at your marginal tax rate.
Withholding tax is applied to the ex-GST amount
When a payer deducts withholding tax, it is calculated on the amount exclusive of GST. The GST component is still payable in full. The net you receive is the total invoice less the withholding tax amount.
IRD-Aligned: Uses 2025-26 NZ GST rate of 15% and standard withholding tax rates.
What your invoices need to include and how GST affects your pricing
What must a tax invoice include in New Zealand?
A valid NZ tax invoice must include: the words "tax invoice", your name and IRD number, the date, a description of the goods or services, the quantity, the price, and the GST amount (or a statement that GST is included). For invoices over NZ$1,000, you also need the buyer's name and address. Without these details, your customer cannot claim back the GST.
Do I need to charge GST on my invoices?
Only if you are GST-registered. If your annual turnover is above NZ$60,000, you must register and charge 15% GST on all taxable supplies. On a NZ$1,000 invoice, you would add NZ$150 GST, making the total NZ$1,150. If you are not registered, you do not charge GST, but you also cannot claim GST back on your business expenses.
How do I calculate the GST portion of an invoice?
To add GST: multiply the amount by 1.15. So NZ$500 becomes NZ$575. To find the GST already included in a price: divide by 23 and multiply by 3. So a NZ$575 GST-inclusive amount contains NZ$75 of GST and NZ$500 before GST. Always show the GST amount separately on your invoice.
How long do I have to send an invoice?
There is no legal deadline for sending invoices in NZ, but good practice is to invoice as soon as the work is done or the goods are delivered. For ongoing work, invoice at agreed milestones or at the end of each month. The sooner you invoice, the sooner you get paid. Most businesses set payment terms of 7 to 30 days.
What payment terms should I set?
Common payment terms in New Zealand are 7 days, 14 days, or 20th of the month following invoice. For new clients, consider shorter terms or even payment upfront. The Construction Contracts Act requires payment within 20 working days for construction work if no other terms are agreed. Late payment interest is allowed but must be stated in your contract.
Can I invoice in a foreign currency?
Yes, you can invoice in any currency. However, for GST purposes, you must convert the amount to NZD using an approved exchange rate on the date of the invoice. IRD accepts rates from the Reserve Bank of New Zealand or the exchange rate you actually received. Keep records of the exchange rate used for each invoice.
What if a client does not pay my invoice?
If you are on the invoice basis for GST, you have already paid GST on the sale even though you have not received the money. If the debt becomes a bad debt (genuinely uncollectable), you can claim back the GST by making a bad debt adjustment in your GST return. You should also consider small claims court (disputes under NZ$30,000) or a debt collection agency.
Do I need to keep copies of my invoices?
Yes. IRD requires you to keep all invoices and financial records for at least 7 years. This includes both invoices you send and invoices you receive. Digital copies are fine — you do not need paper originals. Use cloud accounting software like Xero or MYOB to store invoices automatically and make GST filing easier.
IRD-Aligned: Based on 2025 IRD rates and thresholds. For personal advice, speak to a qualified tax agent.
Disclaimer: This calculator provides estimates based on current HMRC rates and thresholds for the 2025/26 tax year. It does not constitute professional tax, financial, or legal advice. Your actual liability may differ depending on your individual circumstances. Always consult a qualified accountant or tax adviser before making financial decisions. Read our terms
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