55GST groups

1. This section applies to companies meeting the eligibility requirements of subsection (1) or (8) and choosing to form a GST group.

2. The rules in the section are intended to ensure that, with exceptions, the Act treats the members of a GST group as if the members were—

3. as the GST group, a single company—
   1. operating separately each activity that each member would operate in the absence of this section; and
   2. making or receiving each supply that each member, as part of an activity, would be treated in the absence of this section as making to, or receiving from, a person who is not a member; and
   3. acting through the representative member in making elections, giving information other than taxable supply information or supply correction information, keeping records, and making payments required by the Act; and
   4. acting through the issuing member, or the representative member if the GST group does not have an issuing member, in giving taxable supply information or supply correction information; and
4. as the GST group, sharing the responsibilities and liabilities under the Act of the single company; and
5. as individual members, sharing with the representative member some of the individual responsibilities and obligations under the Act arising for the representative member from each activity and supply that would be an activity and supply of the member in the absence of this section.

6. Subsections (1AD) to (1AI) apply to the members of a GST group except in relation to a supply of services that is treated by section 8(4B) as being made in New Zealand.

7. An activity that would in the absence of this section be an activity of a member of the GST group is carried on by—

8. the representative member, as an activity of a registered person separate from other activities of the representative member; and
9. no member of the GST group other than the representative member.

10. A supply that would in the absence of this section be a supply made by a member of the GST group to a person—

11. is a supply made as a registered person by the representative member to the person, if the person is not a member of the GST group; or
12. is disregarded for the purposes of calculating the tax payable by the GST group for a taxable period, if the person is a member of the GST group, except if another provision requires otherwise.

13. A supply of goods and services that would in the absence of this section be made by a member of the GST group, and not be a taxable supply, is a supply made as a registered person by the representative member.

14. A supply of goods and services that would in the absence of this section be made to a member of the GST group, other than a supply that would in the absence of this section be a taxable supply by another member, is a supply to the representative member as a registered person.

15. If goods and services are acquired, or produced, or applied, by a member of a GST group (the new member) at a time before becoming a member of the GST group and there is a difference, for an adjustment period, between the percentage intended use by the new member of the goods and services for making taxable supplies and the percentage actual use by the representative member of the goods and services for making taxable supplies, the representative member, for the purposes of section 21(1), has—

16. acquired, or produced, or applied, the goods and services at the time with a percentage intended use for making taxable supplies equal to the percentage intended use of the new member; and
17. made claims for input tax and adjustments of output tax, relating to the goods and services, when the same claims were made by the new member before becoming a member of the GST group.

18. Information provided to a member of the GST group under section 78F is provided to the representative member and information provided by a member of the GST group under section 78F is provided by the representative member.

19. Subsections (1AK) to (8) apply to the members of a GST group unless a provision of the Act expressly provides otherwise or the context requires another result.

20. When part of the GST group, the members of the GST group have the same taxable period under sections 15 to 15ED and the same accounting basis under section 19 or 19A.

21. The representative member is—

22. responsible for making elections of the GST group under the Act and making the returns, giving the information, subject to subsection (1AM), and keeping the records, required by the Act for the GST group; and
23. treated as paying tax paid by a member of the GST group; and
24. responsible for paying the tax payable by the members of the GST group, subject to subsection (1AO)(a).

25. A GST group may choose that the taxable supply information or supply correction information, for a taxable supply that would in the absence of this section be made by a member (the active member), be issued—

26. in the name of the active member, by the active member; or
27. in the name of the representative member, by—
    1. the representative member; or
    2. a member (the issuing member) whose identity and role are notified to the Commissioner by the representative member.

28. The representative member, and an issuing member or active member, of a GST group must meet the requirements of sections 19J and 19L for taxable supply information and supply correction information.

29. A person who is, or has been, a member of the GST group has the following responsibilities and liabilities:

30. joint and several liability with the other members of the GST group under subsections (1AP) and (1AQ) for all tax payable, and not paid, by the representative member for each taxable period, or part of a taxable period, in which the member is part of the GST group; and
31. the responsibilities and liabilities of a member of the GST group under the provisions of—
    1. sections 19J, 19L, and 25; and
    2. section 75, for the activities of the member while the member is part of the GST group; and
    3. Part 8 (Registration), if the person is a registered person when the person is a member of the GST group.

32. If a member (the leaving member) leaves a GST group, the leaving member is relieved from liability for tax payable by the GST group for all or part of a taxable period if—

33. the assessment for the liability of the GST group is made after the later of—
    1. the date on which the leaving member is treated as leaving the GST group:
    2. the date of the event that causes the leaving member to be treated as leaving the GST group; and
34. the amount assessed is more than an earlier assessment of the GST group for the taxable period or part of the taxable period; and
35. the Commissioner considers that the removal of the liability will not significantly prejudice the recovery, or likely recovery, of the amount of tax assessed for the taxable period or part of the taxable period; and
36. the Commissioner notifies the leaving member and the representative member that the requirements of paragraph (c) are met.

37. The responsibilities under subsection (1AO) of a person who is, or has been a member of a GST group—

38. are unaffected by the person’s ceasing to be part of the GST group or by a representative member’s ceasing to exist; and
39. may be relieved by the Commissioner under subsection (1AP).

40. For the purposes of this Act, 2 or more companies (the companies) are eligible to be a GST group at a time if,—

41. at a time and under section IC 3 of the Income Tax Act 2007, the companies are a group of persons (the eligibility group) that—
    1. is a group of companies; or
    2. is part of a group of companies; or
    3. would be a group of companies but for 1 or more members being a multi-rate PIE or a look-through company; or
    4. would be a group of companies but for 1 or more members being a listed PIE; and
42. the companies meet either or both of the following requirements:
    1. at the time, are each a registered person:
    2. as the eligibility group and in a 12-month period that includes the time, make supplies to persons outside the eligibility group that are taxable supplies, or would be taxable supplies if made by a registered person, and that have a total value of at least 75% of the total value of the taxable supplies and other supplies made in that period by persons in the eligibility group to persons outside the eligibility group.

43. Despite subsections (1) and (4)(a), a person registered under section 54B may not apply to be a member of a GST group or for a further company to be a member of a GST group, if the resulting GST group would have both resident and non-resident persons as members.

44. Where 2 or more companies apply to be members of a GST group for the purposes of this section, and the Commissioner is satisfied that they are eligible to be members of a GST group pursuant to subsection (1), they shall be members of a GST group from the beginning of such taxable period as is determined by the Commissioner.

45. In any application made under subsection (2)—

46. one of the companies shall be nominated to be the representative member; and
47. the company nominated under paragraph (a) must be a registered person.

48. Where any companies are members of a GST group, the representative member nominated under subsection (3) may apply to the Commissioner for—

49. a further company eligible to be a member of that GST group to be a member of that GST group; or
50. one of the members of that GST group to be excluded from that GST group; or
51. another member of the GST group to be nominated as the representative member, and the member nominated under subsection (3) to no longer be the representative member; or
52. that GST group to no longer be a GST group for the purposes of this section,—
and the Commissioner shall grant the application from the beginning of such taxable period as is determined by the Commissioner or from the date required by subsection (4AA).

53. If the representative member applies under subsection (4) for a company to be a member of the GST group and the company is incorporated less than 12 months before the application and is eligible to be a member when it is incorporated, the Commissioner must grant the application from whichever date the representative member chooses of—

54. the date of the company’s incorporation:
55. the start of the taxable period following the date of the company’s incorporation.

56. Repealed

57. The appointment of a specified agent, as defined in section 58(1), does not affect the membership of a GST group.

58. Where any member of a GST group has ceased to be eligible to be a member of that group, and—

59. that member or the representative member of that GST group notifies the Commissioner of that cessation pursuant to section 53(1)(d); or
60. the Commissioner is otherwise satisfied that any member of a GST group has ceased to be so eligible,—
the Commissioner shall, by notice given to that member or that representative member, terminate that membership from such date as may be specified in the notice.

61. For the purposes of this Act, any notice served in accordance with this Act, which is addressed to the representative member of a GST group is served on that representative member and on all members of the GST group.

62. Repealed

63. Repealed

64. If the members of a group of 2 or more registered persons include a person that is not a company or is a limited partnership and the Commissioner is satisfied in relation to the members of the group that—

65. one of them controls each of the others; or
66. one person controls all of them; or
67. 2 or more persons carrying on a taxable activity in partnership control all of them,—
the Commissioner may accept that the registered persons are a GST group, and subsections (2) to (6) apply to the group of registered persons as a GST group and to each of the registered persons as a member of the GST group.