IRD have released information about updates to GST invoicing and record keeping allowing for greater flexibility.
The new rules may mean you may need to update your business processes and systems so please read on to see how they may affect you.
Note: How you calculate GST is not changing, just the rules relating to invoicing and record keeping.
Changes coming from 1 April 2023
From 1 April 2023, there are changes to terminology, rules, and documentation requirements, these include:
- The requirement to use tax invoices is being replaced by a more general requirement to provide and keep certain records known as ‘taxable supply information’.
- You’ll no longer need to keep a single physical document holding the taxable supply information, such as a tax invoice, credit note, or debit note.
- Your transaction records, accounting systems and contractual documents may, in combination, contain all the information you need to support the figures in your GST returns.
- However, as taxable supply information also includes tax invoices, you can keep using tax invoices if you wish.
- The information you need to provide or keep depends on the value and the type of supply.
- Taxable supply information can be provided using an automated direct exchange between a buyer’s and seller’s software, for example PEPPOL e-invoicing.
What you need to do before 1 April 2023
- Familiarise yourself with the new rules. The changes are designed for greater flexibility, so invoicing practices, or systems compliant with the current rules will comply with the new rules. However, even if you decide not to adopt the changes, if your suppliers do then you could be affected. For example, if you purchase goods after 1 April 2023, the invoice you receive from the supplier may no longer include the term ‘tax invoice’. This is now acceptable for tax reporting purposes.
- Identify how these new rules may impact your business processes and systems. If you use third party software, please talk to your provider about how they are incorporating these changes into their software.
- Determine what changes you may need to make to be ready for the changes coming in April.
Find out more
For more information and details around the new terminology, rules, and documentation requirements, please visit IRD.
And as always if you have questions, please feel free to get in touch with us.
About Kiwitax – Award winning business improvement, tax and accounting service
Here’s the thing. As a business, rental property owner or start-up, you get a kick out of having your own gig. But chances are dealing with your tax and accounting leaves you cold. Good news! We love it, so hand it over to Kiwitax and we’ll look after it all for you.
Whether you deal with us online, by phone or drop into our Napier office, you’ll find a friendly, professional hardworking team ready to work with you, however you keep track of your financial information and from wherever you do business. And all for a fixed price. It takes just two minutes to get a quote.
Plus, if you’re at a loss to know how to improve aspects of your business – from growth planning to cashflow management, even tax debt and so much more – we’re all over that too. Our Business Improvement advisors can help you make a plan and put it into action.
Kiwitax are a preferred training provider for Business Improvement services through the Regional Business Partner Network Capability Voucher Scheme. This is a government funded scheme designed to boost business capability by providing funding of up to 50% of approved training programs with specified training providers up to a maximum value of $5000.
If you liked this article and want to make improvements in your business, with quarterly coaching sessions specifically tailored to support you to identify and achieve your business goals, lets chat!