Nobody sits you down and explains the paperwork before you start a business in New Zealand. You just discover it, piece by piece, usually right when you need it. Here’s the order it actually comes in, without the jargon.
Sole trader or company, and why it’s not as big a decision as it feels
Most people starting out default to sole trader because it sounds simpler, and structurally it is: no registration required, you just start trading under your own name (or a trading name) and declare the income on your personal tax return. The trade-off is personal liability. If the business owes money or gets sued, that’s your money and your assets on the line, not a separate company’s.
A limited company separates that out. The company is its own legal entity, registration is done through the Companies Office online (a same-day process, for a modest fee), and your personal liability is generally limited to what you’ve put into the company. It also comes with more admin: annual returns, more formal accounting, a director’s obligations under the Companies Act. Neither structure is objectively right. A one-person consulting business with low risk often stays a sole trader for years. A business taking on staff, signing contracts, or working in anything with real liability exposure (building, anything client-facing with expensive mistakes possible) tends to move to a company sooner rather than later.
The NZBN comes first, almost regardless of structure
The New Zealand Business Number is a single identifier for your business that other systems increasingly plug into: invoicing, government agencies, business directories including this one. If you register a company, you get an NZBN automatically. If you’re a sole trader, you can register for one yourself at nzbn.govt.nz, free, in a few minutes. Do this early. It’s the thing you’ll be asked for repeatedly later, and it’s mildly annoying to realise you don’t have one halfway through filling in something else.
GST: the threshold that catches people out
You’re required to register for GST once your turnover passes, or is expected to pass, $60,000 in a 12-month period (check ird.govt.nz for the current figure before you rely on it, thresholds do get reviewed). Below that, registration is optional. Plenty of very small or part-time businesses stay under it deliberately, because registering means charging GST on everything you sell and filing returns, in exchange for being able to claim GST back on business expenses.
Here’s the bit that actually trips people up: once you’re near the threshold, don’t wait for a review notice from IRD to tell you. Track your rolling 12-month turnover yourself. Registering late doesn’t erase the obligation, it just means you owe the GST retroactively without having collected it from customers along the way, which is a genuinely bad position to be in.
An IRD number and, usually, a separate business bank account
If you’re a sole trader you already have an IRD number from your personal tax history; a company gets its own on registration. Either way, open a separate bank account for the business even if you’re not legally required to as a sole trader. Mixing personal and business transactions in one account is fine right up until tax time, when you’re trying to reconstruct six months of spending from memory. This is the advice every accountant gives and almost nobody follows in year one, and almost everyone wishes they had by year two.
Where a directory listing actually fits into all this
It’s tempting to treat marketing as the fun part you get to once the paperwork’s sorted, and the paperwork as the boring gatekeeper standing in the way. In practice they’re more tangled than that. Your NZBN, once you have it, is also what verifies your identity when you claim or list a business on a directory like FindAKiwi. The compliance side and the visibility side end up needing the same piece of paper.
None of this is exciting, and none of it needs to happen in one sitting. Get the structure decided, get the NZBN sorted, keep an eye on the GST threshold, and open the separate account before the first invoice lands. Everything else can wait until it’s actually relevant.
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