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Tax Management for Your Airbnb Property in New Zealand with 2024 GST Changes

Prosaic Team10 min read

New Zealand's Airbnb hosting landscape shifted significantly with GST legislation changes effective April 1, 2024. This guide covers the key changes and what they mean for your tax obligations — whether you're GST-registered or not.

Understanding the GST threshold

Previously, Airbnb hosts only needed to register for GST once their earnings exceeded $60,000 annually. Once registered, you charged and collected 15% GST on rental rates and claimed it back on related expenses.

The new "app tax" GST changes from April 2024

From April 1, 2024, all accommodation and transport services facilitated through electronic marketplaces (like Airbnb, Bachcare, and Vrbo) incur a 15% GST regardless of your registration status.

Electronic marketplace operators become the designated service providers responsible for collecting and remitting GST on all transactions — including short-stay accommodations.

Impact on GST-registered owners

If you're GST-registered:

  • Report your GST number to rental platforms
  • Classify platform income as zero-rated supplies in your GST returns
  • Continue claiming GST on relevant business expenses
  • You are not eligible for the flat-rate credit

This structure means registered owners aren't double-taxed — the platform collects GST and you report zero-rated income.

Impact on non-registered owners

Non-registered hosts receive an 8.5% input tax credit deducted from their taxable supply — approximately simulating the GST benefit without requiring registration. This results in slightly increased effective revenue without the compliance burden of GST registration.

Should I register my holiday home for GST?

Advantages:

  • Reclaim GST on business-related expenses
  • Improved cash flow and operational efficiency

Disadvantages:

  • Property sales trigger GST obligations, which can significantly reduce net sale proceeds
  • Requires rigorous bookkeeping and more complex tax compliance

This is a significant decision — get professional advice before registering, particularly if you may sell the property in the future.

Deductible expenses

Maximise tax deductions by claiming:

  • Utility costs (electricity, internet, water)
  • Property maintenance and repairs
  • Mortgage interest or rental payments (proportionate to rental use)
  • Insurance premiums
  • Property management fees and platform commissions
  • Depreciation on furniture and appliances

Maintain receipts and comprehensive records.

Income apportionment for mixed-use properties

For properties used both personally and commercially, apportion income and expenses based on actual usage. Only rental-related portions qualify as taxable income and deductible expenses.

Example: A property rented 90 days and used personally 30 days (120 total days) would have a 75% rental use ratio. Annual expenses of $12,000 × 75% = $9,000 deductible.

Capital gains and depreciation

Selling an income-generating Airbnb property may trigger capital gains tax implications depending on your situation and the bright-line test. Claim depreciation on eligible assets like furniture and appliances to reduce taxable income during your ownership period.

Professional advice

Tax regulations for short-term rentals are complex and continue to evolve. Getting professional tax advice is crucial to navigate compliance while optimising your tax position — especially given the new platform-GST rules.