Paying GST on a replacement device sent by Microsoft

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tardtasticx

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#270202 28-Apr-2020 10:19

So my Surface Pro (5th Gen I think) developed white spots all over its display. Microsoft have said they will be replacing it but need it sent back to them.
I've received shipping information and it's going to Sydney, AUS to their returns centre/partner.
They have given me no option of taking it to a local repair centre or office, I'm required to ship it to them directly.

Now as I understand it, it could incur GST when they send me a replacement: https://www.customs.govt.nz/personal/duty-and-gst/faqs/

I paid $1,598 for this device from JBHIFI a little under 2 years ago, which included GST of $208.44.
In the shipping documents is an invoice Microsoft created which lists the value as $609.39USD, using the Customs conversion rate of 0.59USD=1NZD, it comes to $1,032.86 so will be liable for GST of $154.93 and Entry Fees of $55.71.

I've emailed customs the above to confirm what I'm suspecting, and they've said there's no cost if Microsoft repair the device and send it back, but if it's replaced then the new device will incur the above charges from them if the value is over $1k. If it's under $1k they won't collect the GST.

I feel I'm a little stuck right now, trying to explain anything to the support person that's beyond a simple "yes/no/here's the fault" is near impossible to do.
I had considered taking the Surface back to JBHIFI but I've had less than ideal encounters with them trying to get out of their obligations in recent years (after the initial purchase from them above) so I would prefer not to go to them if possible.

Has anyone got any advice or recommendations on the above?

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#2472631 28-Apr-2020 10:34

According to the page you linked, you claim a gst refund on the returned item, and pay gst on the new item. To me this makes complete sense since the replacement item might have a different value to the original one.

Microsoft should be up to doing this.

SirHumphreyAppleby

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#2472678 28-Apr-2020 10:44

BlinkyBill:

According to the page you linked, you claim a gst refund on the returned item, and pay gst on the new item. To me this makes complete sense since the replacement item might have a different value to the original one.

No, it doesn't make sense to apply for a refund and then incur this charge again. GST is normally based on the amount paid, so even if he is sent an item of higher value, it's not relevant to the amount of GST collected. In addition to GST the imported replacement would also incur the import entry transaction fee. Even if the original item were imported by him personally, that fee is not refundable.

Sounddude

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#2472683 28-Apr-2020 10:51

I just had my Xbox returned from Aussie from warranty repair. (It was replaced)

Didn't incur any GST costs.

tardtasticx

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#2472687 28-Apr-2020 10:52

As far as I understand I can only claim the GST back if it was imported by me but I purchased it locally, and GST was paid at that purchase point rather than through customs or an overseas seller. I don’t think I can claim it based on that?

tardtasticx

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#2472689 28-Apr-2020 10:53

Sounddude:
I just had my Xbox returned from Aussie from warranty repair. (It was replaced)

Didn't incur any GST costs.

What was the value of that in NZD if you don’t mind sharing?

Sounddude

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#2472696 28-Apr-2020 11:03

tardtasticx:
Sounddude:

I just had my Xbox returned from Aussie from warranty repair. (It was replaced)

Didn't incur any GST costs.

What was the value of that in NZD if you don’t mind sharing?

The official documents are gone, but it was a One X, and from memory was around the $500 NZD mark.

BlinkyBill

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#2472700 28-Apr-2020 11:04

SirHumphreyAppleby:

BlinkyBill:

According to the page you linked, you claim a gst refund on the returned item, and pay gst on the new item. To me this makes complete sense since the replacement item might have a different value to the original one.

No, it doesn't make sense to apply for a refund and then incur this charge again. GST is normally based on the amount paid, so even if he is sent an item of higher value, it's not relevant to the amount of GST collected. In addition to GST the imported replacement would also incur the import entry transaction fee. Even if the original item were imported by him personally, that fee is not refundable.

That’s quite correct, but discounts the possibility of a different-valued replacement item. It is possible that a different item be used as a replacement with or without a price change being applied. The process described in the Customs page accounts for that, otherwise there would need to be two processes, one for situations where there was no change in value, and a second where there was a change in value.

I shouldn’t have used ‘value’ when I meant ‘price paid’. Apologies.

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BlinkyBill

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#2472705 28-Apr-2020 11:09

Sounddude:

I just had my Xbox returned from Aussie from warranty repair. (It was replaced)

Didn't incur any GST costs.

In my experience, items labelled ‘warranty repair’ come straight through. I foolishly bought a Technomarine watch that went back and forward for repairs and eventual replacement a few times. Eventually they had to refund me, but that’s a different story.

Sounddude

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#2472706 28-Apr-2020 11:09

You will probably find that Microsoft will send it with their GST number/Import code anyway since it was locally purchased. Thats what Apple and others do for warrenty repairs.

I suspect Microsoft does the same.

Jashan

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#2472746 28-Apr-2020 12:22

I work for a business and have about 15 surface devices. I have replaced about 5 of them within in warranty and about 2 outside the warranty. I have never received anything from customs saying that we owe them GST on the items.

snnet

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#2473016 28-Apr-2020 20:15

Goes via UPS usually, have sent lots of Surface Pros over to Australia, some for warranty repair some for out of warranty - they return the item stating its value is very low ($1 if I remember correctly) - even for the out of warranty shipments. I believe the GST for the OOW repairs is taken when you pay for it online.

Never had an issue with customs, last one came back late Feb

Handle9

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#2473035 28-Apr-2020 20:52

Sounddude:

You will probably find that Microsoft will send it with their GST number/Import code anyway since it was locally purchased. Thats what Apple and others do for warrenty repairs.

I suspect Microsoft does the same.

They do it for international repairs as well. I had a surface pro replaced in July last year. It was purchased in the UAE and replaced in NZ. No GST payable by me and no problems.

boosacnoodle

963 posts

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#2473040 28-Apr-2020 20:56

If you ever replaced an Apple device they declare the value of the device quite low but it's very clearly stated as warranty which seems to get them through.

antoniosk

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#2473138 29-Apr-2020 09:11

Look, this is JBHifi's job and not yours. It's under 2 years old, and most people get that when its under then they need to take care of it. Give JBHifi the opportunity - you are taking on the role and management the retailer should be doing.

________

Antoniosk

hyperman

418 posts

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#2478969 7-May-2020 22:08

antoniosk:

Look, this is JBHifi's job and not yours. It's under 2 years old, and most people get that when its under then they need to take care of it. Give JBHifi the opportunity - you are taking on the role and management the retailer should be doing.

Normally I would agree with you there however with MS it is MUCH quicker if the customer deals direct,

yes I work for a retailer and they end up asking us a crap load of questions that we just don't have the answers to so in turn we have to go back to the customer.

to the OP I have never had any issues with GST on any repair/replacement items

The views expressed by me are not necessarily those of my employer

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