Home » Emigration Guides » New Zealand » Business » Opening A Business In New Zealand

To establish a business in New Zealand, migrants must have telegraphic transfer documentation proof of the transfer of at least half a million NZ$ from their home country to a New Zealand bank. A second option, the Long-Term Business Visa Category, is useful for prospective migrants as it gives a nine-month start-up period during which only 'sufficient funds' for the start-up and self-maintenance are required. At the end of the period, proof of the development of your business should result in a three-year visa as the first step towards residence.

Most new business owners in New Zealand begin as sole traders, progressing later to partnerships and/or full company status. Testing the waters in this way is the best method to use. Before you set up your business, you should notify the Inland Revenue as to your self-employed status, at which point you will be able to register for accident cover through the Accident Compensation Corporation (ACC).

Another benefit of registration with the IR is that you will be able to claim tax relief on your business expenses from the start, plus your correct tax coding will be on the IR's computers. Comprehensive records in all sectors of your business should be kept from your start-up date and a separate bank account should be established, with a cash card or business credit card in the business's name saving you from operating a petty cash account.

Using an accountant to keep an eye on your cashflow and profits versus expenses as well as dealing with your income tax and sales tax returns is essential, as IR rules are no more straightforward or unchangeable in NZ than they are anywhere else in the world. Paying an accountant for services rendered will save more than it costs when your annual tax bill is calculated and the savings as regards stress relief are incalculable!

Consulting a lawyer on matters such as leasing premises, staff employment contracts, etc is also advisable, especially for recent immigrants to the country planning to open a business. Self-employment in a single-owner business is a 24/7 occupation, with the owner entirely responsible for the debts and liabilities of the business, with a comprehensive business protection policy the best idea for those new to the game.

GST, New Zealand's sales tax, is charged at 20 per cent, but small businesses are not required to register until their annual turnover looks likely to exceed NZ$60,000 during the next year. However, most SMEs will find it advantageous to register as they can then claim back GST paid on all business supplies, thus saving on start-up costs. The downside is the bi-monthly GST return, although low-turnover businesses can opt for a return every six months.