GST liability of recipient organisations

The following information on GST liability is of a general nature and organisations are advised to seek more specific advice from their tax advisor or the Inland Revenue Department.

The receipt of postage paid envelopes by a not-for-profit organisation which is not registered for GST under the Goods and Services Act 1985 will have no GST consequences for the organisation.

The organisation should, however, take the value of the free postage into account in determining whether it needs to be registered for GST purposes or not.

If an organisation is registered for GST then it may need to account for the GST output tax on receipt of any free postage envelopes.

If there is any doubt about whether your organisation needs to account for the GST output tax because it is making both taxable supplies and exempt supplies, then expert advice on GST obligations should be sought.

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