Non-Resident Supplier GST in NZ: Reverse Charge Workflow

A non-resident supplier invoice is not automatically claimable for NZ GST. First check whether the document actually charges NZ GST at 15%; if it does not, classify the purchase as remote services, imported services, low-value imported goods, or an ordinary import before deciding how it belongs in the GST working papers.

The reverse-charge question is narrower than many AP teams assume. For imported services, Inland Revenue's reverse charge guidance says the reverse charge requires GST of 15% on the price of the services and applies when intended or actual taxable use is less than 95% of total use. That makes the reverse-charge workflow a document review problem as much as a tax rule: the reviewer needs evidence from the invoice, not a guess based on the supplier's country.

Start with the document in front of you. The useful fields are the supplier's legal name, country, any NZ GST or IRD number shown, invoice date, currency, net amount, tax amount, gross amount, and the words used to describe the supply. A Google Ads or cloud-hosting invoice, an Australian consultant's invoice, and an overseas online store receipt can all sit in the same AP queue, but they do not raise the same GST question.

The first decision is whether the supplier has charged New Zealand GST. A 15% GST line with NZ registration evidence is different from AU GST, VAT, sales tax, or a generic "tax" line in a foreign currency. If NZ GST is charged and the business has the right evidence, the invoice may support an input-tax claim in the normal way. If no NZ GST is charged, the next question is not "can we claim it anyway?" but "what type of cross-border purchase is this, and does any reverse-charge or import rule need review?"

Keep those questions separate. Registered non-resident or local suppliers can charge NZ GST. Remote-services suppliers may treat GST-registered business buyers differently from consumers. Imported services can bring section 8(4B) into play for partly exempt or mixed-use recipients. Low-value imported goods have their own collection mechanics. A clean AP workflow records the evidence for each branch so the GST return is supported by a file trail rather than memory.

Sort the Document Into the Right GST Regime

The supplier's country is only the first clue. AP should sort the invoice into a GST regime before coding the tax line, because the evidence needed for each branch is different.

A practical sort looks like this:

• NZ resident or local entity: The supplier is a New Zealand business, local reseller, or local subsidiary. The ordinary NZ taxable supply information requirements are the better reference point, because the document should support the GST charged by a NZ supplier.
• Registered non-resident or local supplier charging NZ GST: The document shows a NZ GST amount, usually at 15%, and some registration evidence. AP still checks that the tax is NZ GST, not a foreign tax line.
• Remote services supplied into New Zealand: This covers many digital subscriptions, advertising platforms, cloud tools, and online services. From the buyer's seat, the key question is whether the account is being treated as a consumer account or as a GST-registered business account. Some remote-services suppliers may zero-rate B2B sales when the buyer has provided NZ GST-registered business details.
• Imported services with no NZ GST charged: This is where section 8(4B) reverse-charge review may matter, especially for businesses with exempt or mixed-use activity.
• Low-value imported goods or ordinary imports: Goods are not the same as services. For low-value imported goods around the NZD 1,000 boundary, check whether GST was collected by the offshore seller and whether Customs processes are relevant. For higher-value or ordinary imports, the import entry and Customs evidence may drive the GST support rather than the supplier invoice alone.

This sorting step prevents two common mistakes. The first is treating every overseas SaaS bill as outside GST just because the supplier is not based in New Zealand. The second is claiming tax shown on an overseas invoice as input GST without proving it is NZ GST. AU GST, VAT, sales tax, or a platform's generic tax line may be a real cost, but it is not automatically claimable in a New Zealand GST return.

The document should carry the reason for the code. If the supplier has charged NZ GST, retain the GST line and registration evidence. If the account is B2B zero-rated, retain the supplier portal setting or invoice wording that supports that treatment. If the purchase is imported services, retain the classification and taxable-use note. If the document is for goods, keep enough evidence to show whether GST was collected by the seller or handled through Customs.

Apply the 95 Percent Reverse-Charge Test

Section 8(4B) matters most when the recipient is not using the imported services almost entirely for taxable activity. The practical AP question is not simply "is the supplier overseas?" It is "does this imported service fall into a reverse-charge review, and what taxable-use evidence supports the conclusion?"

For many fully taxable businesses, the review may be brief. The invoice is classified as imported services, no NZ GST is charged, the intended taxable use is 95 percent or more, and the working paper records that no reverse-charge output GST adjustment was needed. That is still useful evidence. It shows the reviewer considered the issue rather than ignoring it.

The risk increases for partly exempt or mixed-use businesses. Examples include financial-services activity, residential accommodation, entities with exempt revenue, group charges that serve more than one activity, or businesses where a single overseas service supports both taxable and non-taxable operations. In those cases, the working paper should not rely on a default "business expense" code. It should capture the intended or actual taxable-use percentage and show how the GST effect was calculated.

The minimum calculation fields are:

• GST-exclusive price in NZD
• exchange-rate source or conversion basis
• taxable-use percentage
• reverse-charge output GST
• input-tax deduction, if any
• net GST effect
• source file and page reference
• reviewer note explaining the treatment

That same discipline applies in other reverse-charge regimes, although the legal tests differ by country. A cross-border finance team that also handles Singapore entities, for example, should not copy the NZ rule into Singapore files, but it can use the Singapore reverse charge GST workflow for foreign supplier invoices as a process comparison for how invoice classification, taxable-use review, and source evidence belong together.

Escalate the judgement calls. Material purchases, mixed exempt and taxable use, intra-group services, or unusual contractual arrangements should go to the accountant or tax adviser with the extracted invoice evidence already organised. AP's job is to make that review efficient and traceable, not to turn a complex GST exposure into an unsupported code.

Read Major SaaS and Advertising Invoices Carefully

Recurring SaaS and advertising invoices need the same evidence discipline as any other non-resident supplier document: contracting entity, tax label, rate, currency, account tax setting, and source record. The brand name is not the evidence.

For advertising and cloud platforms, start with the tax invoice and billing entity, not the activity summary or usage dashboard. A local Google tax invoice may support a normal NZ GST claim; a cloud account billed through an overseas entity may instead need classification and taxable-use evidence. AP should capture the invoice issuer, GST line, payer or linked-account tax setting evidence, service period, amounts, currency, and the source page that supports the treatment. If the invoice has no NZ GST line, the review moves to classification and taxable-use evidence, not to a manual input-tax claim.

Vendor formats change, and multi-entity suppliers can bill from different entities depending on product, region, account type, or reseller channel. A subscription through a New Zealand reseller is a different evidence pattern from a direct overseas platform charge, so the supplier-master note should record the current evidence rather than rely on last month's assumption.

Treat the non-resident GST registration check as part of supplier-master-data maintenance. If the invoice shows NZ registration evidence, retain it. For local NZ suppliers in the same batch, a quick pre-payment NZBN check on the supplier invoice confirms the entity is active, GST-registered, and matches the name on the invoice before funds go out. If the supplier portal shows that the buyer has provided GST-registered business details, retain that evidence too. If the document shows foreign tax only, code it as a foreign tax cost or exception for review rather than treating it as New Zealand input GST.

Build the GST Working Paper From Extracted Fields

The working paper should let a reviewer understand the GST treatment without reopening every invoice. That means AP needs more than the supplier name and total. It needs the tax evidence, classification, calculation inputs, and source reference in one structured file.

For non-resident supplier invoices, useful columns include:

• supplier legal name
• supplier country
• NZ GST or IRD number if shown
• invoice number and invoice date
• service period or delivery date
• net amount, GST amount, and gross amount
• invoice currency
• exchange-rate source or NZD conversion
• goods or services classification
• vendor category, such as SaaS, advertising, cloud, consulting, or goods
• remote-services flag
• taxable-use estimate
• reverse-charge output GST
• input-tax deduction
• GST treatment reason code
• source file and page reference
• reviewer notes

Those fields are close cousins of the ordinary supplier invoice fields to capture for bookkeeping, but the non-resident workflow adds evidence that domestic AP coding does not always need: supplier country, GST-registration evidence, foreign-tax distinction, taxable-use percentage, and reverse-charge calculation fields.

Add a short review block to the same working paper. Flag foreign tax treated as NZ GST, SaaS assumed GST-free without invoice or account evidence, missing taxable-use percentages for partly exempt activity, unsupported remote-services account settings, and portal invoices saved without source references. Record the review sequence too: supplier and contracting entity identified, NZ GST evidence checked, tax classified as NZ GST, foreign tax, or no tax, purchase classified, taxable-use percentage recorded for imported services, reverse-charge calculation completed where required, evidence attached, and exceptions routed before filing. If taxable use is not recorded, the GST101A return prepared from supplier invoices can become difficult to support later.

Invoice Data Extraction is useful in this step because the work is extraction and structuring, not automated tax advice. A finance team can upload the supplier invoices, describe the columns it wants, and download Excel, CSV, or JSON output. For a recurring GST review, the prompt can ask the system to extract non-resident supplier invoice data into one row per invoice with supplier details, tax lines, currency, classification notes, and the source file and page number for verification.

A suitable prompt shape is:

Extract one row per invoice. Include supplier legal name, supplier country, invoice number, invoice date, currency, net amount, tax amount, total amount, any NZ GST or IRD number shown, tax label, goods or services classification, service period, and source file and page number. Add a notes column for any unclear tax evidence.

That output still needs human review. The reviewer decides whether the purchase is remote services, imported services, low-value goods, ordinary imports, or a local taxable supply. The value of the spreadsheet is that every decision starts from consistent evidence rather than a folder of mismatched PDFs and portal receipts.