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  • Claiming GST

    Can GST be claimed if you are not in business yet but plan to be one in future say in 2-4 months time?

    Some examples would be: Office equipment that you buy now as it's on offer, trucks (vans/diggers/Ute), installing certain things to your vhecial that will be used in future such as towbar.

    Or would it be better to start a company/business first or decalre your self as soletrader etc?

  • #2
    You can't claim GST unless you are registered for GST on the date of the transaction, as far as I know.
    DFTBA

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    • #3
      Could I register for it still without being a company? trying to get an understanding how this works, the IRD site made me go around in circles, the site is helpfull but proably not to my understanding of it as there are certain things I question, and when I call them they say "speak to an accountant" ............................

      Another situation maybe buy a place to renovate and sell at a latter date when market is better <-- Plan is to sell

      So before you actually start getting in to this , you buy the tools you may require and leave it in storage untill you are ready to start the business.

      Could you register for GST and claim on the exspenses?
      And say after 5 months latter there is a change of circumstances and you don't end up starting the business what happens then with the claim?

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      • #4
        Originally posted by Blind Egg View Post
        Could I register for it still without being a company?

        and when I call them they say "speak to an accountant" ............................

        Could you register for GST and claim on the expenses?
        And say after 5 months latter there is a change of circumstances and you don't end up starting the business what happens then with the claim?
        Yes, no need for a company.

        Speaking to an accountant is good advice given the questions you are asking. There are free business mentoring programs paid for by the govt - check your Yellow Pages and the net for your area.

        You can register for GST now. If the project doesn't work out you can deregister but you'll have to repay the GST you've claimed.

        I really think you need an accountants advice.

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        • #5
          Also if I register for GST and claim. Say 2 months down the track I start the company could I unregister myself and pass it pass it over to the company/business when I start?

          I may/not have to pay the tax back to IRD as the business will be under my name or if I do have to pay it back and claim through the business once its registered for GST. How would this work?

          Would it be better to keep the reciepts untill I start the company within the same financial year and claim it at the end of the financial year under the business name?

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          • #6
            I gently suggest that if you are going into business then you need an accountants advice on a number of issues with GST being only one of them. Trying to get advice off the net is hit and miss, much as people like to be helpful.

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            • #7
              If you buy some things now, into a non-GST-registered
              entity, you can 'transfer' them to the same now-GST-
              registered entity and claim the GST at that time. Sort-of.
              .
              Want a great looking concrete swimming pool in Hawke's Bay? Designer Pools will do the job for you!

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              • #8
                You can claim GST before you have started trading as long as you have the intention of trading.

                If you register for GST as a sole trader and purchase the goods that you are going to be using for your business thats fine. However if you are eventually going to set up a company and then transfer/sell them to you company they would be taxable supplies and you would be required to pay GST on them when you sold them to your business. This would be canceled out by a GST claim by the company. This would create alot of unnecessary hassle.

                You are better of setting up your company then registering for GST.

                The other alternative if your turnover is going to be less than $40,000 is to not register for GST.
                NZ Tax fixed fee accounting, we are an online accounting practice. Our integration with Xero and our unique approach provides provides superior value to our clients.

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                • #9
                  Originally posted by Winston001 View Post
                  I gently suggest that if you are going into business then you need an accountants advice on a number of issues with GST being only one of them. Trying to get advice off the net is hit and miss, much as people like to be helpful.
                  I totally agree, and would have not been so polite in my suggestion - but I think Winston is an accountant, and is concerned about appearing biased.
                  Working for a commercial property company, the biggest problem I see with the tenant's businesses is that they may know how to do their job, but don't have a clue about setting up and running a business well enough to turn any amount of hard work in to a profit. Running your own business, you definately need to have 2 hats, and the time and knowledge to wear both well. If you don't know something, you need to bring that knowledge in via accountants, lawyers etc.

                  Originally posted by buxlo122 View Post
                  The other alternative if your turnover is going to be less than $40,000 is to not register for GST.
                  It's $60,000 now.

                  Good on you for having the drive to do your own thing. I suggest you go to a few small business meetings, and call IRD to get the free assistance provided.

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