IS 20/04
Issued
04 Jun 2020

Goods and services tax: GST treatment of short-stay accommodation

This interpretation statement is the final item in a series of guidance on the income tax and GST consequences of providing short-stay accommodation through peer-to-peer websites such as Airbnb, Bookabach and Holiday Houses.  The statement explains the GST treatment of supplying short-stay accommodation and confirms these supplies are not exempt supplies.  The statement also discusses the requirements for registration, the main consequences of registration, change of use adjustments and what happens when the property is sold or the short-stay accommodation activity ceases.  These latter topics will be useful in providing guidance to taxpayers of the options available where their short-stay accommodation activity has been affected by Covid-19.  

Tax Information Bulletin Vol 32 No 6 - July 2020

Goods and Services Tax Act 1985, ss 2 (“dwelling”, “commercial dwelling”, “place of residence”, “principal place of residence”, “output tax”), 2A (“associated persons”), 3A, 4, 5(3) and (15), 6(1)(a), 8(1), 10(2), (3), (6), (7A) and (8), 11(1)(mb), 14(1)(c), 20, 20G, 21, 21A–21C, 21CB, 21D–21F, 21FB, 21G, 21H, 21HB–21HC, 21I, 51, 52, 57
Income Tax Act 2007, ss DG 3, YA 1 (“associated person”)
Residential Tenancies Act 1986, ss 2 (“premises”), 38
Taxation (GST and Remedial Matters) Act 2010

Allen Yachts Charters Ltd v CIR (1994) 16 NZTC 11,270 (HC)
CIR v Bayly (1998) 18 NZTC 14,073
Case 15/2014 (2014) 26 NZTC 22-025
Case K55 (1988) 10 NZTC 453
Case N27 (1991) 13 NZTC 3,229
Case N43 (1991) 13 NZTC 3,361
Case N27 (1991) 13 NZTC 3,229
Case P73 (1992) 14 NZTC 4,489
Case R38 (1994) 16 NZTC 6,212
Case V16 (2002) 20 NZTC 10,182
CIR v Bayly (1998) 18 NZTC 14,073 (CA)
CIR v Dormer (1997) 18 NZTC 13,446 (HC)
Concepts 124 Ltd v CIR [2014] NZHC 2,140
Hibell v CIR (1991) 13 NZTC 8,195 (HC)
Holdgate v CIR (1995) 17 NZTC 12,036 (HC)
Newman v CIR (1995) 17 NZTC 12,097 (CA)
Staithes Drive Development Ltd v CIR [2015] NZHC 2,593
Wakelin v CIR (1997) 18 NZTC 13,182 (HC)