Registering your business name in New Zealand

Entrepreneurship can be such a lucrative career. So much so that it would be a surprise to have a business idea that no one else has thought of before. That’s why starting a business involves a lot of work (and risk) before you even start trading. In this post, we’ll look at what you should consider and how to register your business in New Zealand.

Have an idea? Evaluate it

A lot of business ideas that seem groundbreaking can turn out to be fairly average when you consider the potential long-term strategies and revenue models. This is why it’s important to evaluate your idea thoroughly first. If you’re staring at your first business idea, we recommend joining business groups—either online or in your local area—and talking to other founders and entrepreneurs about how they determined their idea was viable. Talking to people who’ve walked the same path you’re contemplating is more valuable than any bookish knowledge.  

While evaluating your business idea, it’s also worth looking at specific requirements, such as workplace health and safety regulations, food handling laws, certifications like a hairdressing and barbering license, and licenses to sell and serve alcohol on your premises.

Once you know you have a powerful idea, consider a name for your business. New Zealand’s Ministry of Business, Innovation & Employment has created ONECheck, a free online tool you can use to check if the name you want is available. It also provides additional information, such as domain name suggestions and potential social media handles. Having a domain and social media names that align with your business name will establish your brand, while improving your business's credibility. For example, while yourbusiness.com is generic, yourbusiness.nz clearly defines your identity and helps potential customers recognise you better. 

You can purchase your domain name from the New Zealand Domain Name Commission.

Registering your business name: Sole traders and partnerships

If your business name is available, the next step is to inform the Inland Revenue Department of your intention to start a business.

If you’re a sole trader, you don’t have to register your business, but you should have a personal IRD number which you’ll use to pay taxes on your revenue. If you’re already a tax-paying individual before you decide to become a sole trader, you don’t have to register a separate IRD number for your business. 

If you think you’ll earn more than $60,000 in annual revenue, you should also register for GST. 

If you’re starting a partnership business, you will have a separate IRD number for the partnership itself. However, the partnership isn’t considered a separate legal entity and doesn’t pay tax as an entity. Instead, the partners will include their revenue when filing personal tax returns. 

Sole traders and partnerships don’t have to have a New Zealand Business Number by law. However, you can choose to register for one. 

Trading names and business names

A business name is the name you officially register with the Inland Revenue Department. A trading name is any unofficial name you use to operate your business.

If you’re a sole trader or partnership, your trading name will often be the same as your business name. Distinguishing between a trading name and a business name is more relevant to companies and other incorporated organisations.

Registering your business name: Companies and other incorporated organisations

A company should be registered with the Companies Register. To do this, however, you have to go through a few additional steps. First, apply to reserve your business name. 

Reserving a company name  

To start your application, you’ll need to use your RealMe account to log into Companies Services and pay a $10 fee. You can fill out and submit your application online. If you intend to start a limited company (the common structure), your proposed name should end in either “Limited” or “Tapui Limited”. If you’re reserving a local division of an overseas company, the proposed name should be the same as its parent company. Companies Services will then assess your proposed name and ensure availability. This process typically takes up to two hours, but longer in rare cases. Once your business name is approved, you’ll have 20 business days to incorporate your company. If your reservation expires before you incorporate your company, you'll need to pay another $10 to reserve your name again.

If your application is rejected, Companies Services will offer a reason, and you can re-apply to reserve a different name. 

When incorporating your company, you should also register all current directors, the number of shares issued, and all shareholders of the company. You’ll then receive an email from the Companies Register with consent forms for directors and shareholders. To complete your incorporation, you have to upload all signed consent forms within 20 working days. At the time of incorporation, your company should have at least one share and one shareholder. You can always issue more shares and register more shareholders later.

After incorporation

Registering a new director or an alternative director

Log into your Companies Services account and update your new director’s details. You’ll then receive an email from the Companies Register with a consent form for each new director you’ve appointed. Upload all signed consent forms within 20 working days to complete registration.

Registering the issue of new shares and shareholders

You should file a notice with the Companies Register within 10 days of issuing new shares in your company. If you’re also registering new shareholders, the process is similar to registering directors: Update each shareholder’s information in Companies Services, then upload signed consent forms and allocate shares to each new shareholder within 20 working days. In case your shareholders are under 18 years of age, an adult can hold shares on their behalf.

Parting thoughts

Deciding to start a business is the first of many steps. When you're convinced that your business idea is worth pursuing, other things will fall into place. Once you choose your organisation structure, you'll be well on your way to registering your business name and starting operations. The Inland Revenue Department and the Ministry of Business, Innovation & Employment have put together a set of resources to help new business owners. Have a look at those and always consult fellow business owners for reliable advice. We hope this blog helps you understand the overarching process of registering your business in New Zealand. Have any other business questions you'd like us to address? Let us know in the comments below.