Quiz answers


Know your stuff : Consumer protection (or Part 4A)

1)      Does the $30,000 value of the work include or exclude GST?
ANSWER: It includes GST. 

2)      What kind of work do these consumer protection measures cover?
All kinds of building work to a residential house. This includes project management, retaining walls and fences, building work that does not need a consent and works done by subcontractors (electricians and plumbers for example). It does not include design work in isolation.

3)      Who do these measures apply to on a project?

  • the main contractor on a multi-storey commercial project
  • a plumber working for the main contractor
  • the homeowner's best friend
  • anyone who contracts directly to the client to do residential building work.

ANSWER:  Anyone who contracts directly to the client to do residential building work

4)      You have to have a written contract for all building work. True or false?
ANSWER: False, while it’s not a bad idea, you are only obliged to have a written contract if the value of the work is more than $30,000 including GST.

5)      Can you break down the cost of a job into smaller amounts (like $20,000) multiple times to get around these provisions?
ANSWER: No! The $30,000 (including GST) threshold is calculated based on the total of all building work being done by the building contractor for the client.

This information is published by the Ministry of Business, Innovation and Employment’s Chief Executive. It is a general guide only and, if used, does not relieve any person of the obligation to consider any matter to which the information relates according to the circumstances of the particular case. Expert advice may be required in specific circumstances. Where this information relates to assisting people: