NZ GST exempt supplies — residential rent, financial services

By the TaxAccountants.co.nz editorial team · Published 2026-06-06

Exempt supplies sit outside the GST net. No GST is charged on the sale, and no input GST can be claimed on the costs of making the sale. That is fundamentally different from zero-rating, where the supplier charges 0% GST but keeps the input-credit right. The categories are set by the GST Act 1985.

Exempt vs zero-rated — the core distinction

An exempt supply has no GST charged on the sale and no input GST claimable on costs. A zero-rated supply has GST charged at 0% and full input-GST entitlement on costs. The practical effect: GST embedded in your inputs is an unrecoverable cost for exempt activities, but is fully recoverable for zero-rated activities. The choice between the two is not made by the taxpayer — it is set by the category of supply in the GST Act 1985. Source: GST Act 1985 (legislation.govt.nz).

Residential rent

Renting out a residential dwelling is an exempt supply. The landlord does not charge GST on the weekly or fortnightly rent and cannot claim input GST on costs of maintenance, property-management fees, insurance, or rates. The category captures long-stay residential tenancies; short-stay accommodation (under 4 weeks, holiday rentals, serviced apartments) is treated as a standard-rated taxable supply once the operator is over the $60,000 GST registration threshold. Source: IRD — GST.

Financial services

Financial services are exempt under the GST Act 1985. The category includes payment and receipt of interest, the issue and transfer of debt securities and equity securities, foreign-currency exchange, life insurance, and the underlying financial intermediation done by banks. Fee-for-service work that supports financial services (legal, accounting, advisory fees on a transaction) is taxable, not exempt — only the financial-intermediation supply itself is exempt. Source: GST Act 1985 (legislation.govt.nz).

Donated goods and services by non-profit bodies

Supplies of donated goods or donated services by a non-profit body are exempt. The category sits behind op-shops, charity-store networks and donated-service auctions — the goods or services were given for free, so the non-profit pays no GST on the onsale. Once the non-profit moves into bought-and-resold inventory or fee-for-service work, those supplies fall back into the standard 15% rate (subject to the GST registration threshold). Source: GST Act 1985 (legislation.govt.nz).

Sale of a residential dwelling

The sale of an existing residential dwelling between private parties is exempt. Newly built residential dwellings sold by the builder are typically standard-rated because the builder is in the business of constructing and selling dwellings. The distinction is not the dwelling itself but the seller’s activity — a private owner is not in a taxable activity; a developer is.

Partly-exempt apportionment

A GST-registered person who makes both taxable supplies and exempt supplies is "partly exempt". Input GST on costs used wholly for taxable supplies is fully claimable. Input GST on costs used wholly for exempt supplies is not claimable. Input GST on shared costs — general overhead, partly-used assets — is apportioned by a fair and reasonable method, typically the turnover ratio, with an annual change-in-use adjustment. The mechanics are mechanical but the calculations need a working paper trail. Source: IRD — GST.

Related on TaxAccountants.co.nz

• Zero-rated supplies — the other "no GST charged" category, with input-credit entitlement preserved.
• NZ GST rate — the 15% standard rate.
• GST registration threshold — the $60,000 turnover trigger.
• GST calculator — add or remove GST at the standard rate.