Many countries tax the value of the goods shoppers buy from other countries, and New Zealand is no exception.
The country’s new tax rule, which took effect on December 1st, requires Etsy to collect goods and services tax (GST) on orders shipped to buyers in New Zealand from sellers overseas.
Buyers will pay tax at checkout and Etsy will remit it to tax authorities.
Etsy Collects and Remits the Tax on Your Behalf
In compliance with the new tax law, Etsy collects a 15% GST on orders if each of the following applies:
- You, the seller, are located outside New Zealand; and
- The package is being shipped to a buyer (not a business) in New Zealand
If an order in your shop meets these requirements, the buyer will pay GST at checkout and Etsy will remit the tax that is collected to the New Zealand tax authorities.
For orders placed through standalone PayPal, Etsy will send the GST collected to you as a part of the payment.
The collected tax will be added to your Etsy statement so that Etsy can remit it to New Zealand authorities.
GST does not apply if the transaction is between buyers and sellers both located in New Zealand.
Important Information on Your Customs Form
When shipping your package from outside New Zealand into New Zealand, you need to include Etsy’s tax ID number on the customs form to enable the ecommerce company to collect and remit the tax.
This will ensure that your packages sail seamlessly through customs. Etsy’s ID is 122-669-181.
How has New Zealand’s new GST rule affected your online store?
Please use the comments section below or head over to our Facebook Group for Small Business Sellers and interact with other small business owners.