A provider I purchase services from and resell to my customers has been purchased by an overseas company. Under the current system where it was owned by a NZ company, I buy at a wholesale price, and resell it at a retail price. They charge me GST on the wholesale Price which I purchase from them, and through their
system , the end customer pays me the GST inclusive price by credit card, and I receive all that money. I then pay the GST to the government when I submit a gst return, offsetting the GST that I paid for the wholesale product.

However under the new ownership and the new system they have moved me onto, when I make a sale, they only credit my account with the GST exclusive amount, and they say that they pay the GST directly to the IRD. They say being an overseas company they are required to collect GST directly when my customers make payment through their payment gateway. Even though the invoice that is generated by their systems for my customers, and shows the GST amount etc is from my company, and not from the wholesaler.

They have said that I need to tell the IRD the amount of GST they are paying, but I don't need to pay it. This doesn't sound right to me because when submitting a GST return, I have to pay the GST collected directly. There is no option to say another company is paying it on a gst return. Anyone come across this sort of thing before and what normally happens? I am probably going to have to run this past my accountant, but maybe others have encountered this before.