Inland Revenue issued the draft Interpretation Statement GST and finance leases, explaining how to classify finance leases for the purposes of the time of supply and value of supply rules. It also explains how to account for GST on finance leases when applying any special time and value of supply rules.

CA ANZ recommended:

• The legislation should be reviewed to make the rules more straightforward and understandable. Precisely, determine the original policy intent for the criterion that the agreement be made “at retail” and clarify the wording; and expressly legislate for symmetry or state that the supplier determines the GST treatment.
• The statement should include a summary table setting out the GST time and value of supply under the various lease options mentioned