How is App Store income considered for tax in NZ?

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RickD

280 posts

Ultimate Geek

#140829 21-Feb-2014 11:48

Does anyone know how App Store sales are considered for tax in NZ if you are set up as a sole trader? I'm guessing you don't have to pay GST on sales through the App Stores?

Thanks!

Coil

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#991737 21-Feb-2014 11:51

Come to think of it. Is there any way they can grab you for it?

I suppose as a "company" you would declare income.

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mattwnz

20141 posts

Uber Geek

#991743 21-Feb-2014 11:59

If someone from NZ buys the app, they are surely paying get, but maybe apple are paying that to the NZ gov. Doesn't apple nz have some info for you? Otherwise contact your accountant or ird At the least you will likely be paying income tax on it.

ubergeeknz

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Vocus

#991747 21-Feb-2014 12:02

My understanding is that you should be paid incl. GST (based on the amount you recieve) but if you're not registered, you don't pay any, so you just pocket it.

However if you make more than a threshold you have to pay GST on earnings regardless of business type. I'd suggest you talk to an accountant about your situation.

jarledb

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#991776 21-Feb-2014 12:58

I would think you are not allowed to collect GST unless you are actually registered. Pocketing GST I would think could get you in a lot of trouble. Stealing from the government is never a soft offense..

Where I come from something like that would put you in jail, you can scoff on your taxes a long time without getting in real trouble (jail), but try to mess with GST and they will be all over you in a heartbeat.

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tchart

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#991799 21-Feb-2014 13:25

Not sure about the app store payments.

When I used to sell Windows Mobile apps via a few app portals I used to get paid via bank transfer or cheque. I had to declare this as "overseas" income on my return (the IRD informed me of this as I did my first return incorrectly).

Towards the end the US app portals were also with holding some tax. I was allowed to credit this as tax already paid (after converting the amount to NZ dollars).

Edit: I just declared the income on my IR3 and wasn't registered for GST (all my sales channels were overseas).

Kyanar

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#997623 2-Mar-2014 16:49

You're only liable for GST on transactions where the buyer is also in NZ. In this instance, the buyer is always Apple Australia (or Microsoft Singapore, or Google Ireland, whichever app store you use), which means the income is GST exempt, though you will need to account for it on your IR3/IR4.

nathan

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#997624 2-Mar-2014 16:50

AFAIK there's no GST

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MikeB4

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#997627 2-Mar-2014 16:54

RickD: Does anyone know how App Store sales are considered for tax in NZ if you are set up as a sole trader? I'm guessing you don't have to pay GST on sales through the App Stores?

Thanks!

If you are earning income from products on sold in App Stores it is income for taxation purposes.