Does LinkedIn Ads Charge GST in NZ?

With the rise of digital marketing, understanding the tax implications of advertising on various platforms is crucial for businesses. For New Zealand businesses, one pertinent question is whether LinkedIn charges Goods and Services Tax (GST) on its ads. Let’s delve into this topic.

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. The standard GST rate is 15%. Businesses registered for GST must charge this tax on their sales and can reclaim the GST paid on business expenses, making it a vital aspect of financial management.

LinkedIn Ads and GST

As of 1 October 2016, LinkedIn, like other major digital platforms, started charging GST on its advertising services provided to New Zealand customers. This change was implemented following New Zealand’s regulations requiring overseas digital service providers to collect and remit GST on services supplied to New Zealand consumers.

How Does This Affect Your LinkedIn Ads Billing?

  1. GST Registration: Ensure your business is registered for GST and update your LinkedIn ad account with your GST number. This step is crucial for the correct application of GST on your invoices.
  2. Invoicing: LinkedIn Ads invoices will show the GST amount charged. This transparency aids in accurate accounting and enables you to claim back the GST if your business is eligible.
  3. Claiming GST: Registered businesses can claim back the GST paid on LinkedIn Ads as part of their GST return, provided the ads are used for making taxable supplies.

Steps to Ensure Compliance

  • Provide Your GST Number: Ensure your GST registration number is entered in your LinkedIn Ads account settings. This is essential for the accurate application of GST on your invoices.
  • Review Your Invoices: Regularly check your LinkedIn Ads invoices to ensure GST is being charged correctly. If you notice any discrepancies, contact LinkedIn Ads support for clarification.
  • Consult a Tax Advisor: If you are unsure about how GST applies to your LinkedIn Ads expenses, consulting a tax professional is advisable. They can offer guidance tailored to your specific business needs.