Luke Chemies

So I don't need to charge GST on my invoices or pay it to the IRD.

GST is very separate and different from income tax.

Then into the next year, I get a few clients because Fanny, Danny, Manny and Kenny are all getting in touch going, can you do this for us?

All of a sudden, I'm up around 70 grand worth of income.

Shit, I am obligated to be charging GST.

So when I send Fanny an invoice, I've got to whack on an extra 15% on top once I'm registered and they've got to pay that.

And then I've got to put that GST aside and give it to the IRD.

I can claim some of the costs that I had.

I was running some subscriptions that might have GST.

I paid for a couple of coffee meetings.

I got a new abacus in my accounting practice.

Those all had GST on them.

That can offset my GST bill to a degree.

but most businesses that are profitable and that are selling in new zealand they're paying gst to the ird because they're not spending more than they are selling and one of the biggest costs in new zealand in a business is wages and wages don't have gst on them so most businesses in new zealand are paying gst every time they have to do a gst return the lesson for you here is that

Just because someone told you that none of this shit matters until you do over $60,000 worth of sales, that's not true.

Someone's confused GST and applied that to everything else.

Now if you have to be GST registered and then you don't increase your pricing by 15% to factor in that GST, once you're GST registered, you're going to take a pay cut as well.

because you have to now return 15% of your sales to the IRD.

If you haven't increased your prices, where's that money going to come from?

Out of your pocket.