Main Characteristics of a New Zealand Limited Liability Company:
• The limited partnerships are relatively simple to establish. They are registered in the Registration of New Zealand and come into force at the time of registration, remaining in force until the company is concluded. Each limited company must have a written contract, including certain aspects established in the Law.
• The limited liability company must have its registered office in New Zealand and an official address for official notifications, in this country as well.
• All limited companies must include the words “LP” or “LP” (“Company Limited”) at the end of company’s name.
• Any person (including natural or legal persons or any offshore limited liability company) can become a general partner (“GP”) or limited partner (“LP”), of a limited liability company. The limited liability company must have at least one general partner and a limited partner and the same person may not exercise both figures, in the same society.
• Neither the general partner nor the limited partner must be resident in New Zealand. Furthermore, there is no restriction on the number of general or limited partners.
Limited liability companies in New Zealand are separate legal entities (which have legal personality), but are considered transparent for tax purposes, which means that partners are taxed individually and in proportion to their participation in society. Therefore, limited liability companies in New Zealand can not benefit from the various double taxation agreements in force.
New Zealand does not tax income derived from foreign non-resident partners in a New Zealand’s limited liability company. The non-resident general partner may receive fees, but only when there is no income in the limited liability company from New Zealand, is not subject to tax in this country. As such, the tax declaration should only be made by those limited companies that have obtained some income from New Zealand. However, when there has not been income receive from New Zealand; the safest option is to file a negative declaration on behalf of the limited liability company.
The distributions of the society profit are based in proportion to their participation in society. If necessary, there is a possibility of changing the distribution of benefits to the partners so that it is not proportional to their participation. However, it will have to make careful wording in the partnership agreement. However, all distributions to partners are subject to a solvency test and can not be made unless the company has enough assets to pay its debts.