Claiming GST on Business Expenses in NZ: What You Can and Can’t Claim

Short answer: If you are registered for GST, you can claim back the GST in goods and services you buy to make taxable supplies, as long as you hold the records for each purchase. The claim is 3/23 of the GST-inclusive price. You can’t claim GST on private spending, on exempt supplies such as residential rent, interest and bank fees, or on purchases that carried no GST. The one exception is second-hand goods bought from a seller who isn’t registered. Where something is used both for business and privately, such as a vehicle, you claim only the business share.

This guide follows Inland Revenue’s claiming GST guidance and its GST guide IR375 Working with GST for the 2027 tax year (1 April 2026 – 31 March 2027), for sole traders registered for GST. If you aren’t registered, you can’t claim GST at all: it is simply part of the cost you deduct for income tax. For the basics, start with what GST is in NZ, and if you are deciding whether to register, see GST registration in NZ.

What can I claim GST on?

You can claim GST on anything you buy for the principal purpose (the main reason) of making taxable supplies, provided GST was charged and you keep the record. That covers materials, tools, fuel, software, accountancy fees and most other business costs from GST-registered suppliers.

Expense	Claim the GST?	Why
Materials and stock from a registered supplier	Yes	Bought to make taxable supplies
Tools, equipment, software, accountancy fees	Yes	Business costs that carry GST
Vehicle, phone and internet used for both business and private	Business share only	Private use is excluded
Home office rates, insurance and power	Business share only	Based on the floor area you use for business
Residential rent, mortgage interest, bank fees, loan interest	No	Exempt supplies carry no GST
Purchases from a supplier not registered for GST	No, unless second-hand goods	No GST was charged
Wages, drawings, income tax, private spending	No	Not taxable purchases for your business
GST paid to Customs on imported goods	Yes, as a credit adjustment	See below

In the return, you don’t list GST purchase by purchase. You enter your total purchases and expenses including GST, and the return takes 3/23 of that total as your claim. A $230 invoice contains $30 of GST, because $230 × 3 ÷ 23 = $30. How to file a GST return shows where each total goes.

What can’t I claim GST on?

You can’t claim GST on anything used privately, on anything used to make exempt supplies, or on any purchase that had no GST in it. Inland Revenue says plainly that you cannot claim GST for supplies you use privately or to make exempt supplies. The usual mistakes are claiming GST on interest and bank fees, on rent or mortgage interest for a home office (all exempt, so there is no GST in them), and on purchases from suppliers who aren’t registered.

Assets you bought before you registered are a separate case: you may be able to claim some GST back through an adjustment, and Inland Revenue’s GST adjustments session lists the details you need: the purchase date and price, your registration date and the percentage of business use.

What records do I need to claim GST?

You need the supplier’s taxable supply information (the term that replaced “tax invoice” on 1 April 2023), and how much detail it must show depends on the value of the purchase. Only include a purchase in your return if you hold the record for it.

Purchase value (incl GST)	What you need
$200 or less	A record showing the supplier, the date, what you bought and the amount
Over $200 up to $1,000	Taxable supply information, including the supplier’s GST number and the GST charged
Over $1,000	The above, plus details identifying you as the buyer

The rules are on Inland Revenue’s taxable supply information page. A bank statement line proves money left your account; it does not show GST or what you bought. Keep every record for at least 7 years, as Inland Revenue’s record keeping guidance requires. Self-employed expenses and receipts covers whether photos of receipts count.

Can I claim GST on second-hand goods?

Yes. If you buy second-hand goods from a seller who isn’t registered for GST, such as a private seller, you can still claim a secondhand goods input tax deduction, even though no GST was charged. Inland Revenue’s special supplies page sets out the conditions:

• you are registered for GST,
• you bought the goods to make taxable supplies, and
• the goods are second-hand.

The claim is 3/23 of the price you paid.

Example. A landscaper buys a used trailer through a private sale for $2,300. She can claim $2,300 × 3 ÷ 23 = $300, provided she records the seller’s name and address, the date, a description of the trailer, the quantity and the price paid. Those five details are the record; without them, there is no claim. Buying from an associated person, such as a family member, has its own rules, so check IR375 before claiming.

If the seller is GST registered, this rule doesn’t apply: you claim the GST shown on their invoice as normal.

How do I claim GST on a vehicle or anything used privately?

You claim only the business share, and the method depends on the cost. Inland Revenue’s page on GST adjustments for business, private and exempt use splits it at $10,000, GST exclusive.

Purchase price (excl GST)	How you claim	Later adjustments
$10,000 or less	Principal purpose: all the GST if business is the main purpose, none if it isn’t. Or apportionment: the business percentage	None under either method
Over $10,000	Apportion by your expected business use	Required if business use changes, unless the change is under 10% and the adjustment is $1,000 or less

For vehicles, a logbook comparing private kilometres with total kilometres proves the business percentage, and the same logbook can support your income tax claim.

Example. You buy a van for $34,500 including GST, so the GST is $4,500. You expect 80% business use and claim $3,600 in the return for the period you bought it. Inland Revenue’s change-in-use calculation is the full GST amount × the new percentage, minus the GST already claimed:

• Logbook shows 75% a year later: $4,500 × 75% = $3,375, minus $3,600 = −$225. The change is 5 percentage points (under 10%) and $225 (under $1,000), so no adjustment is needed.
• Logbook shows 60%: $4,500 × 60% = $2,700, minus $3,600 = −$900. The change is 20 percentage points, so you must make a debit adjustment and pay back $900 in your GST return.

Running costs work the same way: claim the business share of the GST in fuel, servicing and tyres, never the private share. For the income tax side of vehicle costs, see NZ kilometre rates and vehicle expenses.

Can I claim GST on home office expenses?

Yes, on the business share of costs that include GST, such as rates, house insurance and power. You can’t claim GST on rent or mortgage interest, because they are exempt supplies. Inland Revenue’s home office expenses page says to leave rent and mortgage interest out of your GST return.

Example. Your office is 10% of your home’s floor area. Your rates are $3,450 including GST, which contains $450 of GST, so you claim $45. Your power is $2,760 including GST, which contains $360 of GST, so you claim $36. Your mortgage interest goes in your income tax claim, never your GST return. Home office expenses in NZ works through the income tax side.

Can I claim GST on imported goods?

Yes, if you’re registered and the goods are for your taxable supplies. The GST you pay to Customs when goods arrive is claimable, but it doesn’t go in your purchases total. Inland Revenue says it belongs in the credit adjustments box instead, and the GST return’s purchases box excludes imported goods.

You need the Customs document to support the claim: an import entry (form C4), a deferred payment of duty statement or a broker account statement. On the invoice basis you claim in the period you get the invoice or pay, whichever is earlier; on the payments or hybrid basis, in the period you pay.

What is the difference between zero-rated and exempt when claiming GST?

A zero-rated sale, such as exported goods, is taxable at 0%, so you can still claim GST on the costs of making it. An exempt sale, such as residential rent or financial services, is outside GST, so you can’t. An exporter who charges no GST can claim GST on materials and freight, and may get regular refunds; a landlord renting out a house can’t claim GST on its repairs, rates or insurance. Inland Revenue’s pages on zero-rated supplies and exempt supplies list the categories.

Keeping claimable records, and where does Keel fit?

Most lost GST claims come down to missing records: a faded receipt, a private sale with no seller details, a van with no logbook.

Keel: Invoice Maker & Receipts, an iPhone app by Ilura Technology OÜ, keeps those records in one place. You capture receipts and expenses, log business mileage, and keep each item under the job and customer it belongs to, next to the quotes and PDF invoices you send. “Who owes you” shows unpaid invoices and prepares reminder drafts that you review and send yourself; nothing is sent automatically. Records stay on your iPhone, with no account, no bank connection and no cloud sync, and the App Store privacy label reads “Data Not Collected”.

Keel doesn’t decide what GST is claimable, work out your GST return, file it or connect to Inland Revenue. It keeps the records you or your accountant work from. It is free with no invoice limit (free invoices carry a small “Made with Keel” footer); Keel Lifetime is a one-time purchase of $249.99 USD (the App Store shows your local price) that adds custom branding, signature, premium templates and accountant-ready exports and reports. Keel on the App Store. More guides are on the New Zealand hub.

Frequently asked questions

Can I claim GST if I’m not registered for GST? No. Only GST-registered businesses can claim GST back. If you aren’t registered, the GST you pay is part of your cost, and you deduct the full GST-inclusive amount as a business expense for income tax instead.

Can I claim GST without a receipt? For purchases of $200 or less, the supplier doesn’t have to give you taxable supply information, but you still need a record of the supplier, date, what you bought and the amount. Over $200 you need the supplier’s taxable supply information, including their GST number. Without the record, leave the purchase out of your return.

Can I claim GST on a vehicle purchase in NZ? Yes, for the business share. A vehicle costing over $10,000 excluding GST is apportioned by expected business use, and you adjust later if that use changes by 10% or more or the adjustment is over $1,000. A logbook is the usual evidence of business use.

Can I claim GST on second-hand goods in NZ? Yes, if you are registered, the goods are for your business, and you buy them from someone not registered for GST. You claim 3/23 of the price and must record the seller’s name and address, the date, a description, the quantity and the price paid.

Do zero-rated sales stop me claiming GST? No. Zero-rated sales are taxable at 0%, so you can still claim GST on the costs of making them. Exempt sales, such as residential rent, are different: no GST is charged and you can’t claim GST on related costs.

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This article is general information, not tax advice. Consult a qualified New Zealand tax professional.