New Zealand Entity Setup

Limited liability companies are the most common types of companies in New Zealand. They provide liability to shareholders only to the extent of money contributed to the company. These companies are governed by a board of directors which is responsible for making business decisions and overseeing the general affairs of the company. Directors can be appointed by other directors or by shareholders, and can be removed by an ordinary resolution of the shareholders. Limited liability companies with 50 or more shareholders (and 50 shareholder parcels) are called “code companies.”

Overseas companies that are “carrying on business” in New Zealand must register as an overseas company with the New Zealand Companies Office (Companies Office). The term “carrying on business” is not comprehensively defined for this purpose, although it would capture having employees in New Zealand, having an office or premises in New Zealand or regularly transacting business in New Zealand.

Each shareholder contributes capital to the company by subscribing and paying for shares. There are no minimum capital requirements. The paid up capital can be as little as NZ$1.00.

A New Zealand company only requires one shareholder which can include a company or person living overseas. 

A Limited company must have at least 1 director, and at least 1 director must ordinarily reside in New Zealand.

A limited company is not required to have a company secretary, but if a company has 1 or more, at least 1 of them must ordinarily reside in New Zealand. Corporate secretaries are common in practice. 

Must have a registered office in New Zealand. This does not have to be owned or leased by the company, but the person who owns or leases that property must consent to it being the registered office of the company. Corporate records are generally required to be kept and  maintained at the registered office. The provision of a local registered address by a law firm for third party service provider is allowed. 

The business name needs to be registered through an online method but before that it has to be ensured that the name that has been selected is not already being used. So the name of the company should be distinct. The reservation of the name of the company should be done with the ROC with minimum 1 shareholder, 1 director, and registered office.

In the next step, New Zealand Business Number (NZBN) is obtained. It is a unique identifier for your business which helps others while working with your company. It is easier for you to do business once you obtain a company registration number in NZ as you don’t have to keep on repeating the same information over and over again while dealing with someone new or when something changes.

The application form is filed with the appropriate authority along with the supporting documents. The application will be processed by the department in New Zealand responsible for company registration.

If the application submitted and documents are approved by the department then it will issue the certificate of incorporation.

After the incorporation process is completed, obtaining Income Tax and GST license or certificate from the Inland Revenue is essential for doing business in New Zealand.

Upon execution of legal paperwork, the service provider engaged will provide a copy of the official certificate of incorporation issued by Companies Office, or Companies Register. In New Zealand, Companies Office maintains a system of corporate records via an online platform that can be accessed by directors or your corporate secretary. The Companies Register profile will include a NZBN which is used for a number of the following registrations. 

The Inland Revenue Authority looks into the aspects related to taxation and other form of services in New Zealand.

Employees earning a wage or salary are taxed directly from their pay. This is known as PAYE (pay as you earn).  As an employer, you’re responsible for deducting and paying PAYE income tax on your employees’ behalf.

It is a tax for people who buy and sell goods and services. You might need to register for GST if you sell goods or services. GST is charged at a rate of 15%.

KiwiSaver is a voluntary savings scheme to help set you up for your retirement. You can make regular contributions from your pay or directly to your scheme provider.

ACC is the sole and compulsory provider of accident insurance in New Zealand for all work and non-work related injuries. The corporation administers the ACC Scheme on a no-fault basis, so that anyone, regardless of the way in which they suffered an injury, has coverage under the scheme.