Government expected to move on 'Netflix tax'

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#1620843 1-Sep-2016 12:55

I'd be amazed if you're charged both. My billing address is in NZ and I don't get charged VAT in the first place (albeit for physical items, not Kindle).

littleheaven

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#1620845 1-Sep-2016 12:59

afe66:

Probably because he believes that he should pay tax as part of being part of a wider society which has costs. (I agree with him). But there are other opinions available.

She, actually :) But yes, you're right. Also, I'm a sole trader, so there is the potential I could get audited, and they'd look at everything. Given Netflix is one of the companies specifically targeted by all this, I'd rather be safe than sorry.

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NonprayingMantis

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#1620857 1-Sep-2016 13:33

littleheaven:

afe66:

Probably because he believes that he should pay tax as part of being part of a wider society which has costs. (I agree with him). But there are other opinions available.

She, actually :) But yes, you're right. Also, I'm a sole trader, so there is the potential I could get audited, and they'd look at everything. Given Netflix is one of the companies specifically targeted by all this, I'd rather be safe than sorry.

suspect the IRD would be more interested in how you justify netflix as a business expense rather than worrying about the couple of bucks GST on it.

(well, there are some businesses where it could be justified I suppose, but it would be pretty rare. Maybe you run a motel or something?)

rmt38

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#1620874 1-Sep-2016 13:59

NonprayingMantis:

suspect the IRD would be more interested in how you justify netflix as a business expense rather than worrying about the couple of bucks GST on it.

(well, there are some businesses where it could be justified I suppose, but it would be pretty rare. Maybe you run a motel or something?)

I suspect it's a matter of same bank account used for business and personal stuff for independent contractors. The IRD is bringing online some option to do PAYE as you go by contractors and others, but it requires a business bank account last I looked, which will enforce separation. I know I'll be considering it.

richms

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#1620877 1-Sep-2016 14:02

Got this for my amazon, adobe and google stuff now.

Might have to re-investigate GST registration again. See if it will stack up or just waste too much time for not much refund.

Richard rich.ms

ronw

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#1620880 1-Sep-2016 14:11

What about those who pay Netflix in USA are they going to have to cough up GST somehow or what.

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littleheaven

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#1620927 1-Sep-2016 15:40

rmt38:

NonprayingMantis:

suspect the IRD would be more interested in how you justify netflix as a business expense rather than worrying about the couple of bucks GST on it.

(well, there are some businesses where it could be justified I suppose, but it would be pretty rare. Maybe you run a motel or something?)

I suspect it's a matter of same bank account used for business and personal stuff for independent contractors. The IRD is bringing online some option to do PAYE as you go by contractors and others, but it requires a business bank account last I looked, which will enforce separation. I know I'll be considering it.

Almost. When you're a sole trader there's no legal separation of business and personal finances. I have a separate business account, and I'm not claiming Netflix as a business expense, but because I'm not a limited liability company then any audit from IRD would likely look at all my accounts. I know it's highly unlikely, but I have a history of getting pinged for the smallest of things (witness my 55kmph speeding tickets).

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MikeB4

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#1620933 1-Sep-2016 15:48

littleheaven:

Almost. When you're a sole trader there's no legal separation of business and personal finances. I have a separate business account, and I'm not claiming Netflix as a business expense, but because I'm not a limited liability company then any audit from IRD would likely look at all my accounts. I know it's highly unlikely, but I have a history of getting pinged for the smallest of things (witness my 55kmph speeding tickets).

A wise choice. The IRD can be unforgiving and costly.

old3eyes

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#1621005 1-Sep-2016 18:22

Netflix not raising prices with GST change, but others are

Regards,

Old3eyes

Yabanize

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#1621056 1-Sep-2016 21:15

I disagree with paying GST on Netflix because I see it as an overseas purchase, and usually with overseas purchases you don't need to pay tax unless it's over $300 or something?

When I buy something from aliexpress or ebay I don't need to pay GST unless it's over the threshold

rmt38

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#1621069 1-Sep-2016 21:56

Yabanize:

I disagree with paying GST on Netflix because I see it as an overseas purchase, and usually with overseas purchases you don't need to pay tax unless it's over $300 or something?

When I buy something from aliexpress or ebay I don't need to pay GST unless it's over the threshold

I think the theory is that we don't pay for packages because the processing cost is higher than the tax. And with something that needs to be physically processed, that makes sense. But with something electronic, where the tax can be automatically applied without any work, not so much.

The distinction seems logical and reasonable to me.

tdgeek

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#1621085 1-Sep-2016 22:45

Yabanize:

I disagree with paying GST on Netflix because I see it as an overseas purchase, and usually with overseas purchases you don't need to pay tax unless it's over $300 or something?

When I buy something from aliexpress or ebay I don't need to pay GST unless it's over the threshold

GST is chargeable to buyers on goods and services. Except financial transactions,etc. Look at Bunnings. Almost everything there is foreign. If Bunnings sold DVDs they include GST. Seems perfectly normal that a soft version of the "DVD" is no different. Its a product or service. Law is a bit slow thats all.

wsnz

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#1621913 3-Sep-2016 14:09

tdgeek:

GST is chargeable to buyers on goods and services. Except financial transactions,etc. Look at Bunnings. Almost everything there is foreign. If Bunnings sold DVDs they include GST. Seems perfectly normal that a soft version of the "DVD" is no different. Its a product or service. Law is a bit slow thats all.

What you're alluding to is the GST exempt (e.g. financial services) & zero rated GST (e.g. imported services) supplies.

tdgeek

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#1622102 3-Sep-2016 19:29

wsnz:

tdgeek:

GST is chargeable to buyers on goods and services. Except financial transactions,etc. Look at Bunnings. Almost everything there is foreign. If Bunnings sold DVDs they include GST. Seems perfectly normal that a soft version of the "DVD" is no different. Its a product or service. Law is a bit slow thats all.

What you're alluding to is the GST exempt (e.g. financial services) & zero rated GST (e.g. imported services) supplies.

Not at all, as you know. A DVD attracts GST. Why not the soft version? Say a DVD costs $19. Whats the cost of the hardware? Cents. The value is the content.

A DVD that costs $19 doesn't have a GST content of 4c as in disk plus GST

Yabanize

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#1622189 3-Sep-2016 23:48

tdgeek:

wsnz:

tdgeek:

GST is chargeable to buyers on goods and services. Except financial transactions,etc. Look at Bunnings. Almost everything there is foreign. If Bunnings sold DVDs they include GST. Seems perfectly normal that a soft version of the "DVD" is no different. Its a product or service. Law is a bit slow thats all.

What you're alluding to is the GST exempt (e.g. financial services) & zero rated GST (e.g. imported services) supplies.

Not at all, as you know. A DVD attracts GST. Why not the soft version? Say a DVD costs $19. Whats the cost of the hardware? Cents. The value is the content.

A DVD that costs $19 doesn't have a GST content of 4c as in disk plus GST

But are you buying the DVD from an NZ comapany, or Amazon or eBay for example

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