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Claiming GST on secondhand goods

Updated: Mar 11

For those purchasing secondhand goods from non-GST registered persons you are still able to claim a GST credit even though the seller is not GST registered. The good must be used in making taxable supplies for the business.

A good is considered secondhand when it’s been used and paid for by someone else and was in NZ when you bought it.

For example, buying a Rav 4 as a farm hack from a private seller who is not GST registered, you can claim GST on the purchase price. The amount of GST claimed is 3/23 of the purchase price. For example, if you pay $3,000 for a Rav 4 you can claim GST of $391.30 ($3000 x 3/23).

GST is claimed in the period you make payment for the good.

Livestock are not considered secondhand so if purchasing from a non-GST registered person you are not able to claim GST.

If you are purchasing a secondhand good from an associated party, the GST claim is limited to the lowest of the original purchase price, market value, or the GST included in the original cost to the seller.

You won’t get a tax invoice from the seller, but you need a record of the following details to claim GST:

  • The name and address of the person or business you bought it from

  • The date of the purchase

  • A description of the goods

  • The quantity of the goods

  • The price paid

This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal or accounting advice. You should consult your own tax, legal and accounting advisors before engaging in any transaction.

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