New Zealand company registration

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For over a decade, Healy Consultants efficiently and effectively assists our Clients with New Zealand company registration. So, if you are a foreign investor contemplating how to set up a New Zealand company formation, the following information will assist your firm determine the optimum New Zealand company formation corporate solution to fulfill your objectives:

Advantages of New Zealand company registration

  1. A limited liability New Zealand company formation can be incorporated in the country within a week with a share capital of only US $1. Plus, the Client will not be required to travel to complete the company registration process;
  2. New Zealand company registration requires only one shareholder and one director. The shareholders are not required to be residents in the country;
  3. New Zealand has consistently been ranked the least corrupt country in the world. Consequently, the foreign entrepreneurs can depend on the local laws to resolve all business disputes legitimately;
  4. A local New Zealand business setup allows foreign entrepreneurs to invest in any New Zealand business setup sector, regardless of their nationality;
  5. A New Zealand company formation faces no capital or exchange controls; funds can be easily transferred to or from abroad;
  6. An offshore Financial Service Provider (FSP) and an offshore company formation are legally tax exempt; 
  7. A New Zealand business setup enjoys easy access to the massive Chinese and Australian consumer market due to FTAs signed with these countries. Also, different trade treaties with USA, Russia and India are currently being negotiated;
  8. English is the official language in the country. Consequently, company registration becomes very easy. Plus, conversing in English helps a foreign investor in working with local employees and customers;
  9. NZ ranks 1st in the world in regards to absence of protectionism. Hence, a resident firm can easily engage in import/export activity;
  10. The country is 6th best in the world for registering Intellectual Property. It is a signatory to WTO’s Agreement (TRIPS) which protects resident companies from IP rights violations;
  11. A New Zealand company formation benefits from the country’s double taxation agreements with 37 countries like Australia, China, Germany, Singapore and USA which minimize withholding tax on payments abroad;
  12. Lastly, New Zealand has a metropolitan outlook with the government being welcoming towards foreign workers. Religious beliefs of people are well respected and they are offered protection of the law. Foreign workers, consequently, won’t have to forsake their traditional roots.
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Disadvantages of New Zealand company registration

  1. A New Zealand company formation faces a high corporate tax burden (28%); 
  2. An resident limited liability New Zealand company formation is required to have at least one local director while a listed one must have at least three directors, two out of whom must be NZ residents; 
  3. Following New Zealand business setup, opening a corporate bank account will require the Client to travel to the country;
  4. All NZ resident firms are mandated to properly audit their financial statements if at least 25% of firm’s share capital is contributed by a foreign investor;
  5. A New Zealand company formation will face relatively high labor costs; the average monthly salary for a skilled worker is US $3,200 (excluding bonus);
  6. The country is isolated from rest of the world with a time zone GMT+12. Consequently, flight times to Europe and US can take between 16 – 24 hours.
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Different New Zealand entities

Healy Consultants will assist our Client engineer the optimum New Zealand business setup structure. There are several business entities available, the most common being the LLC, Branch Office, Representative Office and the FSP.
New Zealand office
LLC (Limited Liability Company)

  • This is the most common New Zealand business setup. A limited liability New Zealand company formation can be incorporated in the country within a week with a share capital of just US $1. Our Clients incorporate a LLC in order to setup a small and medium enterprise (SME).

Branch Office

  • This New Zealand company formation entity can conduct business activities only within the scope defined by the parent company. A branch, consequently, is not an independent corporate entity;
  • Branch offices do not face any restriction from the government. Therefore, this New Zealand business setup can be incorporated in all sectors of the economy.

Representative Office

  • This New Zealand company registration entity can only engage in limited business activities such as research, and advertising. Consequently, a representative office is not permitted to invoice clients, import and export raw materials, and sign sales contracts.

Financial Service Provider (FSP)

  • This New Zealand business setup entity performs financial business activities such as accepting deposits, investing and managing securities, providing credit etc.;
  • The New Zealand business setup process for this entity requires separate registration with the Financial Service Providers Registry.

Table of comparison between different business entities


Summary at a glance
LLC
Branch
Rep office
Financial
service
provider
New Zealand Company registration costsUS$2,000US$2,000US$2,000US$2,500
Subsequent annual costs (excl accounting and tax fee)US$1,400US$1,400US$1,400US$1,000
How long to set the company up?1 week1 week1 week1 week
How long to open company bank account?3 weeks3 weeks3 weeks3 weeks
Issued share capital requiredUS$1US$1US$1US$1
RestrictionsNoNoYesYes
Allowed to sign sales contracts with local clientsYesYesNoYes
Allowed to invoice local clientsYesYesNoYes
Corporate tax payable28%28%28%28%
Corporate bank accountHSBC or CitiHSBC or CitiHSBC or CitiHSBC or Citi
Can rent local office premisesYesYesYesYes
Allowed to import raw materials?YesYesNoNo
Allowed to export goods?YesYesNoNo
Can the entity hire expatriate staff?YesYesYesYes
Do you need to visit NZ?NoNoNoNo
Resident director required?YesYesYesYes
Resident shareholder required?NoNoNoNo
Minimum number of directors1111
Minimum number of shareholders1111
NZ resident company representativeYesNoNoYes
Individual shareholders allowedYesYesYesYes
Corporate shareholders allowedYesYesYesYes
Corporate director(s) allowedNoNoNoNo
Public register of shareholders and directorsYesYesYesYes
How long to get work permit approved2 months2 months2 months2 months
Statutory audit requiredYesYesYesYes
Annual tax return to be submittedYesYesYesYes
Access to NZ double tax treatiesYesYesYesYes
Total company setup costsUS$5,800US$5,800US$5,800US$21,850
Draft invoiceNew Zealand LLC draft invoiceNew Zealand branch office draft invoiceNew Zealand representative office draft invoiceNew Zealand financial service provider draft invoice

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Tax exempt companies

The offshore LLC

Offshore company formation allows investors to set up an LLC which legally minimizes corporate tax rate in a highly reputable jurisdiction.

Advantages of Offshore Company

  1. An offshore business setup can be 100% tax exempt and so, is referred to as a NZ tax free company formation;
  2. It is possible to buy an existing (shelf) company formation and register it as an offshore LLC within an hour;
  3. A tax free New Zealand business setup has a positive reputation because the country is not blacklisted as a tax haven;
  4. The New Zealand business setup process for this corporate entity is simple as no public registration is required.

Disadvantages of Offshore Company

  1. A tax free New Zealand business setup is not permitted to conduct business activities within the country;
  2. An offshore company formation is required to submit annual tax returns and financial statements to the relevant government authorities.
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Offshore finance company

An offshore finance company formation allows investors to set up an FSP which legally minimizes corporate tax rate in a highly reputable jurisdiction.

Advantages of Offshore Finance Company

  1. Offshore finance New Zealand business setup, if done properly, can be 100% tax free;
  2. Inspections from the government are not required for this corporate entity.

Disadvantages of Offshore Finance Company

  1. An offshore finance company formation is less reputable than the onshore FSP registered within the country;
  2. Like other offshore entities, an offshore finance company formation is, also, not permitted to conduct business activities within the country;
  3. An offshore New Zealand company registration must submit annual tax returns and financial statements.
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Offshore limited partnership

Like other offshore entities, an offshore limited partnership allows the entrepreneurs to minimize their corporate tax liability.

Advantages of Offshore Limited Partnership

  1. The partners who are not NZ residents have no annual tax liability in the country;
  2. An offshore limited partnership is not mandated to file annual tax returns. Plus, partners enjoy their privacy as information about them is not published;
  3. An offshore limited partnership is not required to make any registration with government authorities;
  4. It is possible to buy an existing (shelf) New Zealand company registration and register it as an offshore limited partnership within one hour;
  5. Lastly, like other offshore companies, this offshore business setup is also 100% tax exempt.

Disadvantages of Offshore Limited Partnership

  1. An offshore limited partnership must appoint a NZ resident individual as the firm’s agent;
  2. Like other offshore companies, an offshore limited partnership cannot conduct business transactions within the country.
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Table comparing tax exempt companies


Summary at a glance
LLC
offshore
Offshore
finance
company
Partnership
Company incorporation costsUS$2,000US$2,500US$2,100
Subsequent annual costs (excl accounting and tax fee)US$1,400US$1,000US$1,500
How long to set the company up?1 hour1 hour1 hour
How long to open company bank account?3 weeks3 weeks3 weeks
Issued share capital requiredUS$1US$1US$1
RestrictionsYesYesYes
Allowed to sign sales contracts with local clientsNoNoNo
Allowed to invoice local clientsNoNoNo
Corporate tax payable0%0%0%
Corporate bank accountHSBC or CitiHSBC or CitiHSBC or Citi
Can rent NZ office premisesYesYesYes
Do you have to rent a physical office spaceNoNoNo
Allowed to import raw materials?YesNoYes
Allowed to export goods?YesNoYes
Can the entity hire expatriate staff?YesYesYes
Do you need to visit NZ?NoNoNo
Resident director required?YesYesYes
Resident shareholder required?NoNoNo
Minimum number of directors111
Minimum number of shareholders111
NZ resident company agentYesYesYes
Individual shareholders allowedYesYesYes
Corporate shareholders allowedYesYesYes
Corporate director(s) allowedNoNoNo
Public register of shareholders and directorsYesYesYes
Statutory audit requiredNoYesNo
Annual tax return to be submittedYesYesNo
Access to NZ double tax treatiesYesYesYes
Total company set up costsUS$5,800US$6,700US$6,750
Draft invoiceNew Zealand offshore draft invoiceNew Zealand offshore finance company draft invoiceNew Zealand partnership structure draft invoice

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Tax exempt company Fees


NZoffshore fees schedule
NZ onshore companyNZ offshore finance companyNZ offshore company
Year 1 incorporationUS$2000US$2,500US$2,000
Annual fees from year 2US$1,400US$1,000US$1,400
Nominee shareholder / directorUS$9,600 **US$9,600 **US$9,600 **
Company de-registration**Excludes US$1,100 refundable deposit**Excludes US$1,100 refundable deposit**Excludes US$1,100 refundable deposit
Click attached to view invoicesNew Zealand onshore company draft invoiceNew Zealand offshore finance company draft invoiceNew Zealand offshore company draft invoice

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Accounting Obligations

  1. Annual tax returns must be filed by the 7th of July every year. However, this deadline can be extended on request;
  2. Financial statements submitted by firms with 25% foreign ownership structure will require a proper audit;
  3. Healy Consultants will assist the Client with:
    • Documenting and implementing accounting procedures;
    • Implementing financial accounting software;
    • Preparing financial accounting records;
    • Preparing forecasts, budgets and performing sensitivity analysis
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Tax Regulations

    New Zealand tax

  1. A local subsidiary of a foreign firm is taxed only on its NZ resident income while a local New Zealand company formation is taxed on its worldwide income;
  2. A New Zealand company formation pays a corporate tax at a flat rate of 28% on profits derived from its business activities;
  3. Standard GST (Goods and Services Tax) or VAT is charged at a rate of 10%;
  4. A New Zealand business setup must pay Fringe Benefits Tax (FBT) on all benefits provided to employees; different plans are available for such payments;
  5. A New Zealand company formation has to abide by the Emissions Trading Scheme which levies taxes on a resident firm based on the amount of greenhouse gas emitted;
  6. The government does not levy any capital tax or stamp duties on resident firms;
  7. NZ has signed double taxation agreements with 37 countries like Australia, China, Germany, Singapore and USA to minimize withholding tax on payments abroad;
  8. NZ has signed a free trade agreement with the ASEAN nations. Consequently, there is a removal of tariffs on 99% of exports from the country to Indonesia, Malaysia, the Philippines and Vietnam;
  9. Personal tax are progressive in nature. The rates are:
    • 10.5% for resident individuals earning up to NZ $14,000 annually;
    • 17.5% for resident individuals earning between NZ $14,001 – $48,000 annually;
    • 30% for resident individuals earning between NZ $48,001 – $70,000) annually;
    • 33% for resident individuals earning higher than NZ $70,000 annually.
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Fees

New Zealand company registration fees

 
LLC
Branch
Rep
office
Financial
service
provider
Average engagement costsUS$5,800US$5,800US$5,800US$21,850
Draft invoiceNew Zealand LLC engagement feeNew Zealand representative office engagement feeNew Zealand finance company engagement fee

 
NZ offshore
LLC
NZ offshore
finance
company
NZ offshore
finance
company (local employee + office)
NZ offshore
limited
partnership
Average engagement costsUS$5,800US$6,720US$45,850US$6,750
Draft invoice

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Timelines

The average New Zealand company registration engagement period is 8 weeks as outlined below:

Step
Service
LLC
Branch
Rep Office
Financial
service
provider
NZ offshore
LLC
NZ offshore
finance
company
NZ offshore
limited
partnership
1.Engagement planning1 week1 week1 week1 week1 week1 week1 week
2.Company incorporation1 week1 week1 week1 week1 week1 week1 week
3.Corporate bank account approval3 weeks3 weeks3 weeks3 weeks3 weeks3 weeks3 weeks
4.Corporate internet banking approval3 weeks3 weeks3 weeks3 weeks3 weeks3 weeks3 weeks
Total engagement period8 weeks8 weeks8 weeks8 weeks8 weeks8 weeks8 weeks

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Compliance considerations


Healy Consultants Compliance Department efficiently and effectively assists our Client discharge all legal and tax related obligations to support New Zealand company formation.

  1. New Zealand legal system is efficient in resolving business disputes between resident companies. The court’s decision is binding on all parties, but firms can make appeals to a Higher Court;
  2. A New Zealand company formation is barred from publicly disclosing private information about an individual; 
  3. Equal opportunity laws bar all local companies from discriminating against employees on the grounds of religion, race, gender and sexual orientation;
  4. Anti-trust laws in the country prevent resident firms from entering into contracts which form cartels or monopolies; permission needs to be obtained by all local companies on M & A decisions;
  5. All NZ resident firms are mandated to have a legally listed office in the country; this is done for tax and legal purposes;
  6. A New Zealand business setup must publicly disclose the following: i) certificate of New Zealand business setup ii) proof of share allocation iii) company’s constitution and iv) full names and residential addresses of the directors;
  7. A local New Zealand company formation must register for GST if it conducts taxable business transactions and expects to make or makes NZ $60,000 in any 12-month period;
  8. Foreign entrepreneurs wishing to purchase sensitive land in the country will be required to obtain government approval;
  9. A resident firm is required to pay their employees’ payroll tax liability on a monthly basis;
  10. A New Zealand company formation must abide by due diligence guidelines set forth by the government for engaging in a commercial activity with a non resident New Zealand company formation;
  11. New Zealand company registration does not permit an FSP and an offshore finance company formation to operate with the word “bank” in their title;
  12. It is mandatory for a New Zealand business setup to hold an AGM (Annual General Meeting). The 1st AGM must be held within the first 18 months of the date of registration while the subsequent ones should be no later than 15 months after the previous one;
  13. The country is party to the UN Convention on the Recognition and Enforcement of foreign arbitral awards; arbitration in other countries that also follow the convention will be enforceable in NZ;
  14. All resident firms must file annual tax returns by 7th of July. However, if an extension is required, the firms should apply by the 31st of March.

New Zealand employment visas

Overseas professionals who wish to live and work in the country must get a work visa. Visa applications will be prepared and submitted by Healy Consultants at the local NZ immigration branch; it can take up to 3 months to get an approval. Different work visa apply to foreign entrepreneurs, employees and visitors which are as follows:

Entrepreneur Visa

  • Foreign entrepreneurs may apply for a long-term business visa to complete the New Zealand company registration process;
  • A long term NZ business visa allows the holder to live in the country for 9 months. After 9 months, the holder can apply for a work visa for the remaining years;
  • The foreign investor will need to provide i) a New Zealand business setup plan ii) how the New Zealand company formation would benefit the country and iii) experience in the field;
  • Summary of costs is:

 
US $
Payable to
Long-term Business Visa2,646NZ Immigration Office
Healy Consultants Fee3,950Healy Consultants
Total Visa Fee6,596

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Employee Visa

  • Individuals intending to work in the country can apply for either a temporary work visa or a skilled migrant visa;
  • A temporary work visa is valid between 3 to 9 months. This visa can be used for i) attending a job interview in NZ ii) attending a corporate event or iii) for conducting business meeting in the country;
  • A skilled migrant visa is granted if the employee is highly qualified and has a job offer in that field from a NZ resident employer. An individual selected under this category is granted a permanent residency;
  • The potential employees must submit i) proof of health and character ii) proof of a valid passport and iii) letter of sponsorship from the employer;
  • Employers will have to confirm sponsorship and provide proof of New Zealand company registration;
  • Summary of costs is:

 
US $
Payable to
Temporary Work Visa298NZ Immigration Office
Skilled Migrant Visa1,985NZ Immigration Office
Healy Consultants Fee3,950Healy Consultants

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Visitor Visa

  • Citizens of certain countries do not require a visa for the purpose of tourism;
  • This visa gives the holder the legal right to stay in the country up to 9 months per an 18 month period;
  • Following documents will be required: i) passport ii) travel tickets or evidence of funds to prove tickets can be afforded iii) proof of funds to show that entire trip is covered and iv) documents declaring the purpose of visit;
  • Summary of costs is:

 
US $
Payable to
Visitor Visa137NZ Immigration Office
Healy Consultants Fee3,950Healy Consultants
Total Visa Fee4,087

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Corporate banking options


New Zealand company registration banking

Business Finance


New Zealand company registration finance

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Banking Services

  1. NZ corporate banking and personal banking products are of a high standard;
  2. NZ corporate bank accounts offers facilities like internet and telephone banking, checking accounts, savings accounts, debit and credit cards, fixed term deposits and wealth management facilities;
  3. Healy Consultants recommends the Client to opt for either HSBC or Citibank. These banks have a higher working experience with foreign customers. Plus, their customer care service is excellent and the operators are highly adept in conversational English.
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Success tips when doing business in New Zealand

Before engaging in the New Zealand business setup process, there are several points that our Client should know:

  1. The Client should prepare a detailed business plan which includes i) an extensive consumer market study ii) an evaluation of competitors and iii) a complete feasibility study of the plan;
  2. The Client must perform a detailed study of the sector where he/she is planning to incorporate a New Zealand company formation; this will optimize your work productivity;
  3. The Client must also i) communicate with the  inland revenue department ii) speak to your local embassy and iii) communicate with our previous Clients who successfully launched a New Zealand business setup;
  4. Prior to New Zealand company registration, the Client must have a proper exit strategy in order to map out potential accomplishments for the future. This will help the firm manage its finances efficiently;
  5. Setting up a New Zealand business

  6. It is important that the Client communicate with us regarding any problems that he/she faces; our experts regularly helps young NZ resident firms succeed in the country.

Corporate culture in the country tends towards conservatism. So, it is important the Client prepare him/herself; these are our suggestions:

  1. You must always make an appointment; walk-ins will convey informality and will not be well received;
  2. You must always be punctual for a business meeting; deferrals must be avoided as far as possible;
  3. You must conduct your own due diligence prior to a meeting. Also, people must be addresses by professional titles unless specifically asked otherwise;
  4. A strict dress code needs to be maintained at all times; dresses must be formal, but not showy;
  5. NZ corporate culture has a deeply entrenched and rigid hierarchy; respect for seniors is the only way to be successful;
  6. Gifts should only be exchanged after the successful conclusion of negotiations; if done before, it will be perceived as bribery or flattery;
  7. Lastly, it rains year round in the county; so, always carry your rain coats around with you.
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Did you know about New Zealand?

  1. NZ royal house is same as Britain’s with Queen Elizabeth II being the queen. Consequently, in order to become a resident of the country, one must swear an oath of loyalty to the Queen;
  2. NZ has two official national anthems; it is only one of the three countries in the world to do so;
  3. In 1893, NZ became the first country in the world to give all women the right to vote;
  4. The Kiwi is a flightless bird that is found exclusively in the country; citizens are often referred by the colloquial term ‘Kiwis’;
  5. Kiwis are passionate about sports, especially rugby, cricket and netball, in which they are considered amongst the best teams in the world;
  6. NZ richest sportsman is Tiger Woods’ former caddie Steve Williams;
  7. NZ has the highest number of golf courses in the world; there are approximately 400 golf courses in the country;
  8. NZ is recognized as the capital of extreme sports such as bungee jumping;
  9. The Lord of the Rings movies were filmed in the country;
  10. The people drive on the left-hand side of the road;
  11. The people of NZ’s Chatham Islands are first in the world to see the new day;
  12. There are over 30 million sheep in the country, outnumbering humans 7 to 1;
  13. There are no snakes in NZ;
  14. There are no nuclear power plants in NZ.
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Useful links

External readings

External videos


Contact us

For additional information on New Zealand company formation, you can email us at email@healyconsultants.com or phone us in New Zealand at (+64) 4831 8737. Address: Suite 5028, 24B Moorefield Rd, Johnsonville, Wellington 6037 NZ.

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