Goods and Services Tax Act 1985

Transitional provisions

85: Certain contracts entered into on or before 20 August 1985

You could also call this:

"Contracts signed before 20 August 1985 have special tax rules"

Illustration for Goods and Services Tax Act 1985

If you have a contract for goods and services that was signed on or before 20 August 1985, it might be affected by the Goods and Services Tax Act. You need to know what kind of contract you have. A non-reviewable contract is a written contract where the goods and services are clearly stated, the price is specified, and there is no way to change the price because of the goods and services tax. You should understand that a review includes renegotiation, adjustment, or alteration of the contract. A reviewable contract is a written contract where the price is specified, but it is not a non-reviewable contract. If you make a supply under a non-reviewable contract signed on or before 20 August 1985, you will not have to pay goods and services tax on that supply, as stated in section 8. If you make a supply under a reviewable contract signed on or before 20 August 1985, you will not have to pay goods and services tax on that supply until the first chance you have to review the price, as stated in section 8.

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This page was last updated on 18 July 2025

View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM85569.

Topics:

Money and consumer rights > TaxesMoney and consumer rights > Consumer protection

84B: Supplies of services made before insertion of section 8(4B), or

"Services supplied before a certain law change came into effect"

85B: Certain contracts entered into before 1 October 2016, or

"Contracts started before 1 October 2016 with regular payments have special tax rules"

Part 12Transitional provisions

85Certain contracts entered into on or before 20 August 1985

For the purposes of this section,—
non-reviewable contract, in relation to any supply, means any written contract, or any agreement entered into pursuant to an enactment, for the supply of goods and services where—
1. those goods and services are specifically identified in the contract or, as the case may be, agreement; and
2. the consideration in money for that supply is specified in the contract or, as the case may be, agreement either by reference to an amount of money or by way of a formula; and
3. the contract or, as the case may be, agreement contains no provision for, and does not otherwise contemplate, any change to that consideration arising either directly or indirectly from the imposition of the goods and services tax; but does not include any contract that provides for or otherwise contemplates a general review of the consideration in money for that supply
review includes renegotiation, adjustment, or alteration
reviewable contract, in relation to any supply, means any written contract, not being a non-reviewable contract, for the supply of goods and services where the consideration in money for that supply is specified in the contract either by reference to an amount of money or by way of a formula.
For the purposes of this Act, where any supply is made pursuant to any non-reviewable contract entered into on or before 20 August 1985, and that supply would, but for this section, be charged with tax under section 8, that supply shall be charged with tax at the rate of 0%.
For the purposes of this Act, where any supply is made pursuant to any reviewable contract entered into on or before 20 August 1985, and that supply would, but for this section, be charged with tax under section 8, that supply shall, to the extent that that supply is made prior to the first opportunity after the said 20 August 1985 for the review of the consideration in money for that supply, be charged with tax at the rate of 0%: provided that the time when that supply is made shall be determined solely by reference to the time of performance of that supply.

Notes

Section 85(1) non-reviewable contract: amended (with effect on 3 December 1985), on 8 August 1986, by section 37(1)(a) of the Goods and Services Tax Amendment Act 1986 (1986 No 43).
Section 85(1) non-reviewable contract paragraph (a): amended (with effect on 3 December 1985), on 8 August 1986, by section 37(1)(b) of the Goods and Services Tax Amendment Act 1986 (1986 No 43).
Section 85(1) non-reviewable contract paragraph (b): amended (with effect on 3 December 1985), on 8 August 1986, by section 37(1)(b) of the Goods and Services Tax Amendment Act 1986 (1986 No 43).
Section 85(1) non-reviewable contract paragraph (c): amended (with effect on 3 December 1985), on 8 August 1986, by section 37(1)(b) of the Goods and Services Tax Amendment Act 1986 (1986 No 43).
Section 85(1) non-reviewable contract paragraph (c): amended (with effect on 3 December 1985), on 8 August 1986, by section 37(1)(c) of the Goods and Services Tax Amendment Act 1986 (1986 No 43).
Section 85(1) reviewable contract: substituted (with effect on 3 December 1985), on 8 August 1986, by section 37(2) of the Goods and Services Tax Amendment Act 1986 (1986 No 43).