General

Closing your business Ta kati i tō pakihi

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Learn how to manage tax requirements, business debt and company registration when you close your business – whether you’re a sole trader, in a partnership, or a company.

Closing is a big milestone

Closing your business is an important milestone.

What you must do mostly depends on:

  • your business structure – for example if you’re a sole trader, in a partnership, or a company
  • if you’re registered for GST
  • if you have employees.

Keeping your records

Once you officially close your business, keep your business records for at least seven years. This applies to all business types – companies, sole traders and partnerships.

Guide to business tax

Closing a company

If your business is a company, do the following when you’re closing down:

  • File all income tax returns up to when you stop trading and tell Inland Revenue you’re closing.
  • If you’re registered for GST or as an employer with Inland Revenue, file all returns up to the date you stop operating, then deregister – otherwise you’ll have to file nil returns.
  • Pay any taxes owed on time to avoid penalties.
  • If you have shareholders, talk to an accountant about any tax implications for them.

You’ll also need to apply to be taken off the Companies Register. Before you do this, check your company details are correct on the register, and make sure your company has:

  • stopped trading
  • paid all business debts
  • distributed all company assets
  • checked liabilities, like rental agreements
  • no creditors trying to liquidate it
  • confirmation that Inland Revenue has no objections.
Removing your company from the registerNew Zealand Companies OfficeClosing down your companyInland Revenue
selling closing closing your business

Sole traders

Do the following when stopping work as a sole trader:

  • File your tax return at the end of the financial year, even if you stopped operating before the end of the year.
  • If you’re registered for GST or as an employer with Inland Revenue, file all returns up to the date you stop operating, and then deregister – otherwise you’ll have to file nil returns.
  • Let your accountant or advisor know that you’ll no longer be self-employed.
Cancel your GST registrationInland Revenue

Leaving a partnership

Do the following when you leave or dissolve a business partnership:

  • File a final income tax return for the partnership.
  • Show your share of the partnership income or loss in your personal tax return.
  • If you’re registered for GST or as an employer with Inland Revenue, file all returns up to the date you stop operating.
  • Split joint-owned assets or proceeds from their sale according to your deed of partnership.

Talk to Inland Revenue or an accountant about rules for leaving a partnership, particularly if the partnership will continue after you’ve left.

Learn more about

Selling, closing, or stepping away