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News and information about the Government's tax policy work programme, including:
- proposed changes to the laws that Inland Revenue is responsible for
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Govt seeks feedback on proposals to clarify GST treatment of bodies corporate

6 June 2014

Revenue Minister Todd McClay today released a Government discussion document which seeks feedback on proposed changes to clarify the GST rules for bodies corporate. For more information see the discussion document and the Minister’s media statement. Submissions close on 18 July.

Hon Todd McClay
Minister of Revenue

Media statement

6 June 2014

Fairness and certainty for bodies corporate 

Minister of Revenue Todd McClay has announced his intention to clarify through legislation that bodies corporate will not be required to register for GST and file returns, thereby aligning them with the rules for other residential property owners.

The proposed law change is in response to legal analysis that suggested bodies corporate may have to register for GST.

“This clarification is a question of pragmatism, fairness and eliminating compliance costs,” Mr McClay says.

“Most bodies corporate are not currently registered for GST, to now require them to do so would impose significant compliance costs. Excluding them will ensure that the legislation aligns with operational practice and provides clarity and certainty.” 

Bodies corporate are entities established by a group of property owners in an apartment building or similar complex. Funded by members’ fees, it allows the property owners to manage building maintenance, insurance, administration and repairs collectively. 

Being registered for GST would require a body corporate to pay GST on their fees and allow them to claim back the GST cost of their expenses. 

Other types of residential property owners (such as owners of stand-alone homes) cannot register for GST or receive GST refunds for maintenance or building repairs. Making the tax treatment of bodies corporate similar to other types of residential property owners is therefore fairer.

“This Government strives for fairness, consistency and the reduction of compliance costs in the tax system. This clarification for bodies corporate is another example of that.”

“The Government’s intention is to include the change in the next available tax bill and for it to apply retrospectively with a saving provision to preserve tax positions that people have taken before today’s announcement.” 

“Most bodies corporate will not have to take any action at all,” Mr McClay says.

A consultation paper has been prepared to show how the changes would be put into effect. The Government invites submissions on whether the proposed new rules achieve the intended policy outcomes. The consultation paper can be found at The closing date for submissions is 18 July.

Media contact: Hayden Cox 04 817 6991, 021 917339