Does Google Ads Charge GST in NZ?
Navigating the world of online advertising can be complex, especially when it comes to understanding the various taxes and fees associated with these services. For businesses in New Zealand, one common question arises: Does Google Ads charge GST?
Understanding GST
Goods and Services Tax (GST) is a value-added tax levied on most goods and services sold for domestic consumption in New Zealand. Businesses registered for GST must charge this tax on their sales, and it is typically included in the price of goods and services. The standard GST rate in New Zealand is 15%.
Google Ads and GST
As of 1 October 2016, Google began charging GST on its services to New Zealand customers. This change came about due to new regulations requiring overseas businesses to collect GST on digital services provided to consumers in New Zealand.
How Does This Affect Your Google Ads Billing?
- GST Registration: If your business is registered for GST, you should provide your GST number to Google. This will ensure that the GST is applied correctly on your invoices.
- Invoicing: When you receive your Google Ads invoice, it will clearly show the GST amount charged. This transparency helps in accounting and claiming back the GST if your business is eligible to do so.
- Claiming GST: Registered businesses can claim back the GST paid on Google Ads as part of their GST return, provided the ads are used for making taxable supplies.
Steps to Ensure Compliance
- Provide Your GST Number: Make sure you have provided your GST registration number in your Google Ads account settings. This step is crucial for the correct application of GST on your invoices.
- Check Your Invoices: Regularly review your Google Ads invoices to ensure GST is being charged correctly. If there are discrepancies, contact Google Ads support for clarification.
- Consult a Tax Advisor: If you are unsure about how GST applies to your Google Ads expenses, it's wise to consult with a tax professional. They can provide guidance tailored to your specific business needs.