New Zealand

Key benefits

New Zealand consists of several islands; the North and South Island plus a number of smaller islands. The capital and seat of government is based in Wellington in the North Island and the overall population is around 4.5 million.

New Zealand has a progressive economy based largely upon banking and finance. In the last 30 years the country has experienced significant structural reform and economic liberalism. There have been several reforms such as the removal of exchange controls allowing the free flow of capital in and out of the country. The government has also implemented various incentives in order to encourage greater investment in New Zealand.

Key benefits of New Zealand:

  • New Zealand is a safe, stable and secure country which offers considerable benefits.
  • The New Zealand legal system is based on English Common Law
  • New Zealand is a full member of the Organization for Economic Cooperation and Development. (OECD)
  • New Zealand has an efficient market driven economy with business stability, extensive free trade agreements and active government support for investors.
  • New Zealand is perceived as being a legitimate tax jurisdiction whilst providing many advantages of an offshore jurisdiction.
  • New Zealand is consistently rated as one of the best places in the world in which to do business
  • New Zealand is the first western country to complete a Free Trade agreement with China., The New Zealand China Free Trade Agreement.
  • Ease of access to Australia is guaranteed through open market trade agreements.

The Companies Act 1993 governs the creation of a company. These can take the following form:

  • Companies
  • Partnerships – Limited Partnership regime is governed by the Limited Partnership Act 2008.
  • Joint Ventures
  • Trusts
  • Foreign Branches

The most common form of entity for foreign investors is the limited liability company.

Tax and accounting regulations

Summary of Requirements for a New Zealand Limited Liability Company:

General Information
Type of Company
Timescale to incorporate
Taxation
Double Tax Treaty Access
Limited Liability Company
2-3 working days. Original Corporate Documents to follow
Corporate Tax 28%
Yes. More than 35 countries have Double Tax Agreements with New Zealand
Directors
Minimum No. Required
Local Director Required
Publicly accessible information
Location of Meetings
1,Corporate Directors are not permitted
No
Yes, directors details are available on a public register
Anywhere
Shareholders
Minimum No. Required
Publicly accessible information
Location of Meetings
1, Corporate Shareholders are permitted
Yes
Anywhere
Company Secretary
Required
Local Secretary Required
Registered Office Required
No
N/A
Yes
Share Capital
Standard Currency
Minimum Authorised
Minimum Paid Up Capital
New Zealand Dollar (NZD)
1 NSD
There are no minimum capital requirements
Accounting & Compliance
Requirements to prepare AccountsYes
Requirement for Audit
  • If over 25% of the shares of the company are owned by a non-resident, audited annual accounts must be filed in the New Zealand Companies Office.
  • This requirement does not apply where shares are held by a New Zealand nominee which holds the shares on behalf of an overseas shareholder.
Local Auditor RequiredYes
Requirement to file Annual ReturnYes. If no Annual Return is not filed by the due date the company risks being removed from the register.
Additional Information
GSTThe current rate of GST is 15%.
Companies must be registered for Goods and Service Tax (GST) if their turnover was more than 60,000 NZD in the last 12 months or is expected to exceed 60,000 NZD for the next 12 months.
Bank Account OpeningBank Accounts can be opened in a number of international banks in New Zealand. Please contact us for additional information.

Taxation for a Limited Liability Company:

Corporate Income Tax Rate:
  • Flat tax rate of 28%
  • A company resident in New Zealand is assessable on worldwide income whether derived from the New Zealand or elsewhere
  • A company not resident in New Zealand is liable only in respect of income derived from New Zealand (*Residency requirements for NZ LLC as below)
Capital Gains Tax Rate:
  • 0%
Withholding Tax:Dividends:

 

  • Dividends to a non-resident are subject to a 30% non-resident withholding tax to the extent not fully imputed. Fully imputed dividends are subject ti a 0% NRWT where the non-resident has a 10% or more voting interest in the company otherwise this will be 15%. Rates may be subject to further reduction under an applicable treaty.

Interest:

  • Interest paid to a non-resident is subject to a 15% NRWT.

Royalties:

  • Royalties paid to a non-resident are subject to a 15% NRWT.
Losses:
  • May be carried forward indefinitely subject to a 49% continuity of ultimate shareholder requirement.

 

Procedure of company registration

The process involved in establishing a company is simple and inexpensive. This is summarized as below:

  1. Reservation of the company name – once the name is reserved the incorporation process must be completed within 20 days otherwise the reservation will lapse.
  2. Information to be provided to the Registrar of Companies including the names and addresses of directors and shareholders, the registered office address and the place of business.
  3. A company can be incorporated within 24 hours.