In New Zealand, Goods and Services Tax (GST) is generally payable on the supply of goods and services, including the sale of artworks. If an artist consigns their artwork to a gallery for sale and the gallery sells the artwork, the artist will generally be considered the supplier of the artwork and will be required to pay GST on their share of the sale price.

The artist will need to register for GST if their annual turnover is $60,000 or more. If the artist is registered for GST, they will need to charge GST on their share of the sale price and remit it to the Inland Revenue Department.

The gallery will also be required to charge GST on the sale price and remit it to the Inland Revenue Department.

If the artist is not registered for GST, they will not be required to charge GST on their share of the sale price, but the gallery will still be required to charge GST on the full sale price and remit it to the Inland Revenue Department.

However, there may be exceptions to this general rule depending on the specific circumstances of the transaction. For example, if the artist and the gallery have entered into a consignment agreement in which the gallery is acting as the agent of the artist, the artist may be considered the principal supplier of the artwork rather than the gallery. In this case, the artist would be responsible for charging and remitting GST on their share of the sale price, even if the gallery is responsible for physically selling the artwork.

Furthermore, if an artist consigns their artwork to a gallery in New Zealand and the gallery sells the artwork to an overseas customer, the artist will generally be required to pay GST on their share of the sale price.

It is important for artists to understand their obligations under GST and to seek advice if they are unsure of their status as a supplier.

This information was supplied by OpenAI ChatGPT and has not been validated by IRD.

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