Freelancer Tax Guide — Self-Employed Income, Deductions, and GST in NZ
the freelancer tax rules in New Zealand. The guide covers the self-employed income declaration, the business expense deductions (the home office, the equipment, the software), the GST registration when exceeding the $60,000 threshold, and the provisional tax requirements.
Self-Employed Income and Deductions
The freelance income is treated as the self-employment income in New Zealand and must be declared in the IR3 tax return. The freelancers may deduct the expenses incurred in earning the income, including: (a) the home office expenses (the portion of the rent, the power, the internet based on the floor area or the time usage), (b) the equipment and the tools (the computers, the software, the cameras — the items under $1,000 are immediately deductible, the items over $1,000 are depreciated), (c) the vehicle expenses (using the IRD kilometre rates or the actual costs), and (d) the professional development, the insurance, and the accounting fees. See our Business Expenses Guide → for the full list.
GST and Provisional Tax
The freelancers must register for the GST when the annual turnover exceeds the $60,000 threshold. The GST is charged at the 15% rate on the invoices. The freelancers may choose the payments basis (the GST on the receipts) or the invoice basis (the GST on the issued invoices). The provisional tax applies if the tax to pay exceeds $5,000. The freelancers may use the standard method, the estimation method, or the GST ratio method for the provisional tax. The IRD provides the myIR online portal for the GST returns and the tax payments. See our Self-Employment Guide → and the Provisional Tax Guide → for the full details.