Your first GST return

The first GST return has an outsized reputation. In practice it's a short form asking two questions: how much GST did you collect, and how much did you pay? The work isn't the form, it's having clean numbers to put in it. This guide walks through what the return contains, the one setup decision that matters (your accounting basis), and how the filing itself goes.

What a GST return actually is

For each taxable period, you report the GST you charged on sales (output tax) and the GST you paid on business purchases (input tax). You pay Inland Revenue the difference, or receive a refund if you paid more than you collected, which genuinely happens in heavy-spend periods. On a $20,000 invoicing period with $2,000 of GST-carrying expenses, you collected $3,000, you paid about $261, and the return transfers the roughly $2,739 difference.

The setup decision: payments basis or invoice basis

When you register, you choose how GST is counted, and for a contractor the choice is nearly always the payments basis:

• Payments basis:GST counts when money actually moves: you owe GST on invoices when they're paid, and claim GST on expenses when you pay them. Available while turnover is under $2 million, which covers every solo contractor. Its virtue is that you never owe GST on an invoice a client hasn't paid yet.
• Invoice basis: GST counts at invoice date or payment, whichever comes first, so a slow-paying client can leave you paying their GST before their money arrives. Compulsory territory only above $2 million.
• Hybrid:invoice basis on sales, payments basis on expenses. The worst of both for a small business; it exists, and that's about all it needs from you.

Filing it

The return is filed in myIR, where the GST section shows the period, the due date, and the form. With clean records the numbers drop straight in: total sales and the GST on them, total purchases and the GST on those. Payment is due the same day as the return, by the 28th of the month after your period ends (with the two seasonal exceptions: the calendar has every date).

Three first-timer notes:

• File even if the period was quiet. A registered person files every period, including nil returns. Skipping a quiet period is how tidy tax records grow their first late-filing mark.
• Only claim inputs you have records for. Each claimed purchase needs its taxable supply information (receipt or invoice), kept for seven years.
• Not everything carries GST.Bank fees, residential rent, and overseas software billed without NZ GST have no input tax to claim. When a receipt shows no GST, there's nothing to claim on it.

The part that actually goes wrong

Almost no one fails the form; people fail the transfer. The GST you collected sat in your account for up to two months looking like money, and the return is the day it stops pretending. The fix is upstream: set the GST portion aside when each invoice is paid, and the return becomes an administrative non-event: the money was never counted as yours.

How Coffer helps

Coffer tracks the GST on every invoice as it's paid and ringfences it on your dashboard, so through the whole period you can see the exact GST amount accumulating toward the next return, alongside the due date counting down. When you file and pay, you log the payment and the ringfence resets for the new period. GST in Coffer covers the workflow.