GST and Transport Services License

Transport Services Licence

Th2 Connect LP holds the Transport Services Licence (TSL) that allows you to hire out your vehicles to Guests with Mighway. This saves you the hassle of applying for your own licence. The Terms and Conditions you agree to when listing your vehicle mean you will operate under our licence when renting out your vehicle with Mighway unless you hold your own license.

If you use our license: Mighway has a two-tiered contractual arrangement, 1) between Mighway and the Renter when vehicles are rented under our TSL, and 2) between Mighway and the Owner when they are paid for use of their vehicle.

As Mighway is in the middle of all transactions, GST is applicable on all bookings between Mighway and the customer. This means that GST must be deducted from the amount paid by the customer before splitting the remaining amount between Mighway and the owner. Mighway handles any paperwork and registration you need to rent your vehicle commercially.  As an owner, you will need to maintain private vehicle insurance and a Certificate of Fitness for your vehicle.  

If you hold and use your own TSL: If you hold and use your own TSL: Mighway is able to pay you for your bookings GST inclusive, and it then becomes the responsibility of the Owner to pay the GST yourself. As an owner you must supply a copy of your TSL to Mighway when registering, you will also need to maintain private vehicle insurance and a Certificate of Fitness for your vehicle.  

How does our TSL work?

"When we created the Mighway business model we took the view that for the benefit of our Owners, it made sense to operate Mighway under our TSL. What this meant was we had to create the terms and conditions in such a way whereby the Owner is contractually renting the motorhome to us and in turn we are renting the motorhome to the Guest. Given our chosen path, what it means from a GST perspective is Mighway must pay GST on all rental income collected from guests (given we are GST registered), which is then paid through to the IRD. This is required to occur on all transactions whether you are GST registered or not. As such, we net this off the rental income collected and then remove our commission. If you are GST registered you are able to reclaim the GST component that we have netted off."

- Dave Simmons, COO

How do we handle GST?

All GST registered owners, or owners using their own TSL, should be getting the full GST inclusive portion of the hire and then passing on the GST through your GST return. So, if you are a local owner with a van hire for $1000 and $100 cleaning fee, you will receive $850 for the hire and $100 for the cleaning fee. If you are not GST registered, you will get those amounts less 15% GST. Please see the table to easily compare this as well.

GST Registered Owners

If the Owner is GST Registered, Mighway will pay GST on to the Owner. It’s the Owners responsibility to then pay GST to the IRD. Currently Owners need to provide an invoice, but we are working on a solution to have buyer-created invoices once the IRD have approved this.

Non-GST Registered Owners

GST on Owners Payment

All pricing on the Mighway platform is GST Inclusive. If the Owner is Non-GST Registered, Mighway is obligated to deduct and remit GST on your behalf to the IRD. GST is paid by everyone regardless of income level.

GST on Expenses

Invoices for parts and services are treated like the Owner was the final customer, as if you had paid the invoice directly to RVSC (or other managed partner).
This is a separate transaction to the Owners payment, and GST on Owner payment has no bearing on GST on expenses.

Read more information on payment and invoicing

For full details, please see our Terms and Conditions