Business Tax Guide — Tax Obligations for NZ Businesses
the business taxation in New Zealand. The guide covers the different business structures (the sole trader, the partnership, the company, the trust), the business income and the expenses, the GST registration, the provisional tax, and the record-keeping requirements for the NZ businesses.
Business Structures
The choice of the business structure affects the tax obligations. The main structures include: (a) the sole trader — the business income is taxed at the individual's marginal rate (10.5% to 39%), with the provisional tax payable if the residual income exceeds $5,000, (b) the partnership — the partnership income is allocated to the partners and taxed at the partner's marginal rate, (c) the company — the corporate tax rate of 28%, with the after-tax profits distributed as the dividends (the imputation credits attached), and (d) the trust — the trust income is taxed at 33% (the trustee rate), with the beneficiary income taxed at the beneficiary's marginal rate. See our Company Tax Guide → for the company-specific rules.
Key Tax Obligations
The NZ businesses must: (a) register for the GST if the annual turnover exceeds $60,000, (b) pay the provisional tax if the residual income tax exceeds $5,000 (the "pay-as-you-go" for the business income), (c) register as the employer if hiring the staff (the PAYE, the KiwiSaver, the ESCT, the ACC), (d) file the annual tax return (the IR3 for the sole trader, the IR4 for the company, the IR6 for the trust, the IR7 for the partnership), and (e) maintain the business records for the 7 years (the invoices, the receipts, the bank statements, the contracts).