The decision to start a business is an important one and future business owners will need to answer a number of questions before commencing, as well as decide if they will set up an exclusively online business or if they will also open a store or a physical location. When the business is an online one, the owner benefits from a high degree of flexibility and is able to easily provide the goods or services to international clients.
Entrepreneurs who are interested in starting an online business in NZ will need to determine a business idea, and then proceed with following the steps that are usually required for starting a business in New Zealand, irrespective of whether it will be a fully online one or it will have a physical store.
Read below to find answers to a number of common questions and feel free to contact our experts in company formation in New Zealand if you plan to start a new online business or if you have decided to take your business exclusively online.
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What are the steps for starting an online business in NZ?
Deciding to start a new business can be a life-changing one. With an online business, entrepreneurs will have the flexibility to run their company from any city in New Zealand they choose or even abroad, however, at the same time, as long as the online business is incorporated in NZ, it will observe all the relevant local rules and regulations.
Starting an online business in NZ will include much the same steps as in the case of a company with an established physical presence in the country. These are summarized below by our company formation agents in New Zealand:
- Decide on your business idea: do you wish to open an online jewellery or clothing store? Or perhaps an e-commerce store? Your idea needs to be a viable one and having a good business plan is a key element;
- Choose a unique business name: you can use an online tool to check the availability of the desired username;
- Choose the type of company: you online business is incorporated as one of the available business forms in NZ; these include the companies, partnerships or sole traders; in practice, a company is the one that offers the highest level of investor protection and is scalable;
- Register the company: the new business is registered with the Companies Office; at the same time it can also be registered for the Goods and Services Tax (GST);
- Others: you can then register your trademark with the Intellectual Property Office; this is the most clear way in which you can protect your brand.
Starting an online business in NZ means that you will not need to rent or purchase an office space. Entrepreneurs can choose to use virtual office services, as these are suitable for online businesses.
Can a foreign national start an online business in New Zealand?
Starting an online business NZ is also an attractive option for foreign nationals and yes, foreigners are permitted to incorporate and manage companies in New Zealand irrespective of their nationality. An aspect that needs to be taken into account is the conditions for visas, entry in the country and the permitted period to remain here.
What are the main conditions for running a business in NZ?
Two of the most important issues business owners will need to keep in mind when running an online business are the protection of data and the tax requirements.
Protecting the business data as well as the customer information is essential in case of online businesses. Working with an experienced team of website developers is essential for the creation of the website or e-commerce store and the company needs to implement sound protocols for the protection of its systems and data. Moreover, the company will observe the regulations in the Privacy Act. Our team can give you more information about privacy.
The taxes for selling goods and services in an online store are the same as for companies that sell their goods in a physical store. The taxes for an online business in NZ include the following:
- Corporate income tax: 28%;
- Withholding tax: 0% or 33%, depending in the type of payment and whether or not it is made to a resident or non-resident;
- Goods and services tax: the standard rate is 15%, applicable to most of the types of goods and services; a reduced rate of 0% applies in some cases; some supplies are exempt from this tax altogether.
The online company will need to follow the accounting and reporting obligations applicable to the business form under which it is incorporated.
We assist investors who wish to open a business in New Zealand whether it is an online one or a business that will engage in various other forms of trading and commercial activities. With our help, investors can understand the importance of choosing the right business form (including assistance for name reservations), and will receive details about hiring staff or protecting their IP rights.
If you are interested in starting an online business in NZ and need more details, as well as assistance during the setup process, please feel free to contact us as needed.
We assist investors who wish to set up a company in New Zealand irrespective of the industry in which the business will activate. Whether it is an online business or a company involved in manufacturing, our company formation agents assist investors from the earliest company incorporation phases, with the Companies Register submissions, as well as with the application for special permits and licenses.