How to Set Up an Entity in New Zealand

New Zealand is often highlighted for its transparent regulatory environment and ease of doing business, offering a robust, English-speaking testbed for Western products, strategic proximity to Australia and wider Asia-Pacific markets, and a common law framework with strong protections for investors and intellectual property.

The process of incorporation is fast, often taking less than a day. In practice, however, “setting up” is more than just completing an online form. The real friction appears in the layers of compliance needed to become fully operational.

Disclaimer: This content is for informational purposes only and does not constitute legal, tax, or financial advice. Always consult official sources before acting.

What Does “Opening an Entity” Mean in New Zealand?

In New Zealand, “opening an entity” usually means incorporating a Limited Liability Company (LLC) as a subsidiary or registering an Overseas Company Branch with the New Zealand Companies Office (NZCO), which is part of the Ministry of Business, Innovation and Employment (MBIE).

For a subsidiary, registration creates a separate legal person that can own assets, incur liabilities, and enter contracts independently of its shareholders. Once registered, the entity receives a New Zealand Business Number (NZBN) and must register with Inland Revenue (IRD) for tax. Only then can it legally trade or hire staff.

Entity Overview in New Zealand

Step-by-Step: How to Open an Entity in New Zealand

Step 1: Choose the Right Structure

Limited Liability Company

A subsidiary (LLC) is the most common route for foreign expansion. The New Zealand company is a separate legal entity. The subsidiary is usually treated as a New Zealand tax resident and is taxed at 28% on its worldwide income.

From a market perspective, a subsidiary is viewed as a local business. This status can be advantageous when bidding for government contracts or working with local suppliers who prefer dealing with a domestic counterparty. The subsidiary must have at least one resident director, maintain its own share register, and keep a minute book in New Zealand.

Overseas Company Branch

A branch is not a separate legal person, and instead the foreign company operates directly in New Zealand. This means that the overseas parent is fully liable for all debts, obligations, and claims arising from the New Zealand branch’s activities.

Limited Partnership (LP)

A Limited Partnership is a separate legal entity that must have at least one General Partner, who has unlimited liability, and one or more Limited Partners, whose liability is limited to their contributions. This structure is widely used by private equity funds, venture capital funds, and other investment vehicles entering New Zealand because it allows an efficient flow-through of tax attributes.

Look-Through Company (LTC)

A Look-Through Company is an election available to closely held companies with five or fewer shareholders. The entity remains a company with limited liability, but for income tax purposes it is treated as transparent. Shareholders are taxed directly on their share of profits at their personal tax rates. In practice, LTCs are more commonly used for small businesses and property-holding structures rather than for large multinational expansion.

Step 2: Verify Business Name Availability

New Zealand’s Companies Office applies strict rules to company names in order to prevent deception and market confusion. Before you can incorporate, you must reserve a name, and the reservation is valid for 20 working days.

To reserve a name, you must first create a RealMe login, which is New Zealand’s government digital identity, and then create an online account with the Companies Office. You then submit a name reservation application and pay the reservation fee, which is NZD $10 plus GST. Unique names are often approved automatically, while borderline or potentially conflicting names may be sent to a Registrar for manual review that typically completes within a couple of business hours. The Companies Office rejects a proposed name if it is almost identical to an existing registered name.

Step 3: Prepare Incorporation Documents

New Zealand supports remote setup and typically accepts digital signatures. Notarization is not generally required for standard incorporation documents, and you do not need a custom constitution to incorporate. If you do not adopt a constitution, the default rules under the Companies Act 1993 apply.

You will need written director consents (often referred to as Form 2), in which each director consents to act and certifies that they are not disqualified from holding office. For the resident director, this consent effectively binds them to the legal duties and potential liabilities of the role.

You also need shareholder consent forms (often referred to as Form 3), in which shareholders agree to take up a specified number of shares. If a foreign company is the shareholder, the form is signed by a director or other authorized signatory of that parent company.

In addition, you must assemble an identity verification pack. This typically consists of certified copies of passports and proof of residential address (such as a utility bill less than three months old) for all directors and ultimate beneficial owners (UBOs).

Step 4: Register with the New Zealand Companies Office

Once your name has been reserved and your documents are signed, you can complete the online incorporation.

You log into your Companies Office account using your RealMe credentials and select the reserved name. From there, you start the incorporation process and enter the required details.

You must provide a registered office address and an address for service. Both must be physical addresses in New Zealand where legal documents and company records can be delivered and inspected. PO Boxes and private bags are not acceptable. Many foreign entities use the premises of an accounting firm or corporate service provider for this purpose. Virtual offices are allowed if they are actual physical locations where records can be accessed.

You then enter the details of each director, including their full legal name, residential address, and date and place of birth. The system checks that at least one director has a residential address in New Zealand or is a qualifying Australian-based director.

Next, you define the share structure. New Zealand companies do not have authorized capital. Instead, you simply state the total number of shares being issued (for example, 100 shares) and allocate those shares to the shareholders.

You upload the signed director and shareholder consents and, if applicable, the company constitution. During this workflow, you can also apply for an IRD number and GST registration. For foreign-owned entities, Inland Revenue may place the IRD number on hold until you satisfy additional customer due diligence, which is closely tied to banking (see Step 5).

You then pay the incorporation fee of NZD $118.74, plus GST, using a credit card or internet banking. Once the application is approved, which often occurs within minutes or a few hours, you receive a Certificate of Incorporation and your NZBN by email. At this point, the company exists as a legal entity, but it may not yet be fully operational until tax and banking setup is complete.

Step 5: Register for Tax and Social Security

For foreign-owned entities, the key constraint at this stage is the requirement for a bank account when obtaining an IRD number.

The IRD number is the company’s unique tax identifier. Without it, the entity cannot file corporate income tax returns, register for GST, or register as an employer for PAYE. Inland Revenue allows customer due diligence to be performed by another New Zealand reporting entity, such as a lawyer, chartered accountant, or trust and corporate service provider, in accordance with the AML/CFT Act. This provider completes Form IR997 (Customer Due Diligence), confirming that they have verified the identity of the relevant parties and the legitimacy of the structure. Inland Revenue may then issue the IRD number without requiring a bank account to already be in place.

GST registration is mandatory if your taxable supplies in New Zealand are expected to exceed NZD $60,000 in any 12-month period. The standard GST rate is 15% on most local supplies, and exports are generally zero-rated. You may choose to register voluntarily in order to claim input GST on setup and operating costs, particularly if you will be incurring significant local expenses while exporting.

Once your IRD number is in place, you can register as an employer through Inland Revenue’s myIR portal. This sets up the capability to withhold PAYE from employee wages and to account for KiwiSaver contributions and ACC earners’ levies.

Step 6: Open a Corporate Bank Account

For foreign-owned entities, opening a corporate bank account is often the most difficult and time-consuming part of the process. This is primarily because New Zealand banks strictly apply the Anti-Money Laundering and Countering Financing of Terrorism (AML/CFT) Act.

Banks must identify and verify all beneficial owners, which usually means anyone with at least 25% shareholding, as well as individuals with effective control such as directors and key executives. They also must understand the nature and purpose of the business and verify sources of funds and wealth.

The documentation for opening a bank account usually includes the Certificate of Incorporation, NZBN, constitution (if any), detailed ownership and control charts, certified ID and address documents for all relevant individuals, and a detailed business plan. The bank will expect to see why the company needs an account in New Zealand, how it will interact with the local economy, and what types of transactions and counterparties it will have.

The timeline for bank onboarding can span 4–12 weeks.

Step 7: Set Up Payroll and Employment Compliance

Once the entity is ready to hire, you must comply with New Zealand’s employment laws, mainly the Employment Relations Act 2000 and the Holidays Act 2003. New Zealand does not recognize “at-will” employment. Every employee must have a written employment agreement before starting work.

The employment agreement must include information such as the role, duties, hours and location of work, and the pay rate, which must be at least the statutory minimum wage. As of 1 April 2025, that minimum wage is NZD $23.50 per hour.

New Zealand operates a no-fault injury compensation scheme through the Accident Compensation Corporation (ACC). In return for this coverage, the right to sue for personal injury is largely removed. Employers pay an ACC work levy that is calculated as a rate per NZD $100 of liable earnings.

KiwiSaver is a voluntary, work-based retirement savings scheme. If an employee is a KiwiSaver member, the employer must make compulsory contributions equal to at least 3% of gross salary, rising to 3.5% from 1 April 2026.

The Holidays Act requires employers to provide at least four weeks of paid annual leave, around 11 public holidays per year, and sick leave that typically amounts to 10 days after six months of continuous service. Calculating holiday pay is complex, especially for employees with variable hours or earnings, because employers must pay the higher of ordinary weekly pay or average weekly earnings over the previous 52 weeks. Many organizations, including large government departments, have had compliance failures under the Holidays Act, which is why using compliant payroll software or a specialist provider such as Deel is strongly recommended.

Post-registration obligations

Once your entity is operating, ongoing compliance requirements with tax and financial reporting, corporate registers and filings, and employment and sector-specific compliance include:

Tax and Financial Reporting

Companies must file GST returns, commonly at a two-monthly filing frequency. They must also file an annual corporate income tax return (IR4).

Companies must retain accounting, payroll, HR, and transaction records for at least seven years. Records must be kept in English and be accessible from New Zealand in case of audits or inspections.

Corporate Registers and Filings

Companies must maintain up-to-date internal registers of directors, shareholders, and their interests, and they must keep records of resolutions and meeting minutes at the registered office. Any changes to directors, registered office, or address for service must be notified to the Companies Office within 20 working days. In addition, every company must file an Annual Return with the Companies Office that confirms key company information, such as addresses, directors, and shareholdings. The filing fee is around NZD $49.74 plus GST. Failure to file the Annual Return on time is one of the most common reasons that companies are struck off the register.

Licensing and Sector-Specific Obligations

Depending on the industry, additional licences or registrations may be required. These licences often have their own renewal cycles and continuing compliance obligations.

Employment Compliance

Ongoing employment compliance includes keeping employment agreements and policies up to date, processing payroll accurately (including PAYE, KiwiSaver, ACC, and ESCT), and ensuring correct calculation and payment of leave entitlements under the Holidays Act.

Employers also have duties under the Health and Safety at Work Act 2015 to provide a safe workplace, manage risks, and engage with workers on health and safety matters.

Taxes and Financial Considerations

When operating a New Zealand entity, you must manage several ongoing tax and accounting obligations:

Corporate income tax:
New Zealand levies a flat 28% corporate income tax on net taxable profits. Companies with residual income tax over NZD $5,000 generally have to pay provisional tax in instalments during the year, based on estimated current-year or prior-year tax.

GST (Goods and Services Tax):
GST is charged at 15% on most goods and services supplied in New Zealand. Businesses must register for GST if their annual taxable supplies are expected to exceed NZD $60,000. Offshore suppliers of digital/remote services and low-value goods to New Zealand consumers may also be required to register and account for GST once they cross the same threshold.

Payroll and social contributions:
Employers must operate PAYE (Pay As You Earn), withholding income tax from employee wages and remitting it to Inland Revenue. In addition, they are responsible for KiwiSaver employer contributions, the ACC work levy, and Employer Superannuation Contribution Tax (ESCT). ESCT is charged on the employer’s KiwiSaver contributions at 10.5%–39%.

Accounting standards:
Large companies and FMC reporting entities must prepare financial statements using NZ IFRS (New Zealand equivalents to IFRS). Smaller entities may use simplified reporting frameworks.

Discover how Climate-KIC navigated complex restructuring with Deel.

Expand internationally with Deel

Whether you’re hiring through an EOR or establishing your own local entity, Deel’s all-in-one platform gives you everything you need to expand into New Zealand—quickly, compliantly, and with confidence. From market entry to ongoing operations, Deel helps you hire, onboard, and manage teams seamlessly from day one.

With Deel, you can:

• Test new regions using Deel’s local entities through our Employer of Record service—hire employees compliantly, delegate payroll and taxes, and access localized employment contracts.
• Open entities with Deel Entity Setup, where our team manages everything—from incorporation and tax registration to coordination with local experts.
• Centralize your compliance and records with Deel Entity Management, including automated filings, calendar reminders, and visibility across all entities.
• Integrate with Deel Payroll and Deel HR for compliant payments, benefits, and workforce oversight—all in one platform.

For companies transitioning from the EOR model to owned entities, Deel ensures a smooth handover and consistent compliance every step of the way. Enter new markets, onboard talent, and manage your global workforce—all through one unified platform.

FAQs

How long does it take to open an entity in New Zealand?

Incorporation with the Companies Office is typically completed within one working day once documents are ready. However, strict AML requirements and Inland Revenue’s verification process for foreign-owned entities mean that obtaining a corporate bank account and finalizing tax registrations may take up to 12 weeks. You can estimate timelines more precisely using Deel’s Entity Setup Calculator.

What is the minimum capital required?

There is no minimum capital requirement in New Zealand. Most companies issue between 1 and 100 shares at NZD $1.00 each.

Can foreign companies own 100% of an entity in New Zealand?

Yes. Foreign investors can own 100% of the shares in a New Zealand company. They must still satisfy the resident director requirement.

Do I need a local director or representative?

Yes. Every New Zealand company must have at least one director who lives in New Zealand or who lives in Australia and is also a director of an Australian-incorporated company.

How much does it cost to register an entity?

Government fees are relatively modest. You pay NZD $10 for name reservation and NZD $118.74 for incorporation, plus GST. However, the total setup and ongoing costs are higher once you consider professional fees, often in the range of NZD $3,000 to NZD $10,000. Deel’s Entity Setup Calculator can help you model these costs.

Can I hire employees before the entity is fully registered?

In most cases, no. To employ staff directly, you need a legal entity capable of entering into employment contracts and an IRD number to withhold and remit PAYE. Hiring before these are in place can create tax and labor law compliance risks.

If you need to hire immediately, while your entity is still being created, Deel’s Employer of Record (EOR) service allows you to hire staff in New Zealand under Deel’s local entity. Deel becomes the legal employer of record, runs payroll and benefits, and manages compliance, while you manage day-to-day work. Once your entity is ready, employees can be transitioned to your local company.

Can Deel help me open an entity in New Zealand?

Yes. Deel Entity Setup manages the end-to-end process of opening entities in over 100 countries, including New Zealand. This includes coordinating incorporation, obtaining tax and social security registrations, and ensuring that payroll and HR are ready from day one.

Does Deel offer ongoing compliance and payroll support?

Deel offers both managed services and self-service tools. If you use Deel Entity Management, Maintenance, EOR, or Payroll, Deel’s team can handle payroll, benefits, filings, and compliance obligations on your behalf. If you prefer to manage your own entities, Deel Compliance provides real-time regulatory updates, risk alerts, and workforce insights across more than 150 countries.

The Compliance suite includes tools such as Compliance Monitor, Workforce Insights, and an AI-powered Worker Classifier that helps you distinguish between employees and contractors. These tools make it easier to stay ahead of changing employment laws and proactively manage compliance risk as you grow.