Subcontractor Invoice Template - New Zealand

Yes, if you're registered for GST, you must include GST on your subcontractor invoices in New Zealand. GST registration is mandatory if your annual turnover exceeds $60,000. You'll need to charge 15% GST on most services and add a separate GST line to your invoice. The invoice must clearly show the GST amount and your GST registration number. If you're below the threshold and not voluntarily registered, you cannot charge GST, but you must still state this on your invoice. Keep detailed records of all GST charged for IRD compliance.

A legally compliant New Zealand subcontractor invoice must include your business name and address, the client's details, a unique invoice number, invoice date, itemized description of work, quantity and rate for each item, GST treatment (if applicable), total amount due, payment terms, and your IRD number if GST registered. The invoice should clearly identify what makes it a subcontractor invoice—such as the specific project or contract reference. Include your preferred payment method and banking details. This ensures IRD recognition and protects you in payment disputes.

Retention (holdback) is common in New Zealand construction contracts, where the principal withholds a percentage—typically 5-10%—until project completion or defect correction periods end. On your subcontractor invoice, show the full contract value and GST, then separately itemize the retention amount that won't be paid immediately. This transparency protects both parties and aligns with standard industry practice. Your invoice should clearly explain retention terms and the expected release date. If your contract specifies no retention, your invoice shows payment in full. Always clarify retention conditions before starting work to avoid cash flow surprises.

Progress invoicing—invoicing for completed work stages rather than waiting until project end—is standard practice for New Zealand subcontractors, especially on larger projects. It improves cash flow and reduces financial risk. Each progress invoice should reference the contract, specify which project phase or milestones are complete, itemize work completed in that period, and include dates. Clearly distinguish between previous invoices and current charges to avoid duplicate billing. Progress invoices should state payment terms (e.g., 'due upon project stage completion') and maintain running totals. This approach builds trust and ensures timely payment for work delivered.

Detailed work descriptions on a subcontractor invoice protect both you and your client by creating a clear record of what was delivered. Include specific dates, quantities, the location or project section where work was performed, and measurable outcomes (e.g., '8 hours plumbing rough-in work, unit 3' rather than 'plumbing work'). Reference the original contract or purchase order number to link the invoice to agreed scope. Break down labor and materials separately if your contract requires it. Specific descriptions reduce payment disputes, provide evidence for quality standards, and simplify record-keeping for tax purposes. They also demonstrate professionalism to future clients.

Standard payment terms for New Zealand subcontractors typically range from 7 to 30 days, with 14 days being most common in construction. Net 30 (payment within 30 days of invoice date) is also widespread and gives larger projects time to process. Specify payment terms clearly on every invoice: 'Due 14 days from invoice date' or 'Payment due upon project completion.' Include your banking details and preferred payment method (bank transfer is standard in NZ). Late payment interest can be charged under the Late Payment of Commercial Debts (Interest) Act if terms are agreed. Always negotiate terms before work begins to protect cash flow.

If your annual turnover is below $60,000, you're not required to register for GST and cannot charge GST on your subcontractor invoices. Your invoice should show the total amount due without GST and explicitly state 'GST not registered' or similar language. This is legally compliant and common for sole traders and small subcontractors. Clients may ask for proof of your non-registration status. Even without GST registration, you must still invoice professionally with all other required details: your business name, contact details, invoice number, date, itemized work, and payment terms. Keep invoices for business record purposes and tax returns, which require documentation even without GST.

Your IRD (Inland Revenue Department) number should appear on every subcontractor invoice if you're GST registered, as it's a legal requirement for GST invoices. However, if you're not GST registered, including your IRD number is optional but recommended for credibility and tax record-keeping purposes. Including it demonstrates transparency and professionalism to clients. If you're a sole trader, your IRD number may be your personal tax ID; if you operate as a company or partnership, it's your business tax ID. Always check the contract or client requirements—some large project principals require IRD numbers on all invoices for compliance tracking. Omitting it when GST registered can cause payment delays.