CLOSING A COMPANY IN NEW ZEALAND

Closing a company in New Zealand is a process that involves careful planning, legal compliance, and coordination with government authorities. Whether your decision to close stems from completing the company’s purpose, financial difficulties, or a strategic shift, understanding the necessary steps is crucial. This guide – updated in October 2026 – provides a detailed roadmap to help you navigate the process, from passing resolutions to obtaining approvals and completing final formalities.

Key Points (30 Second Read)

The 5 Steps

We delve into each step in detail below, but in brief they are:

1. Pass a resolution
2. Settle outstanding liabilities
3. Complete the IR315A and obtain a Letter of No Objection from IRD
4. Apply for deregistration at the Companies Office
5. Await confirmation

Firstly however, let’s ensure that the need for closure is understood.

Understanding the Need for Closure

The decision to close a company should not be taken lightly. Before initiating the process, ensure you understand the reasons for closure and the implications for stakeholders, including shareholders, employees, and creditors.

Some common reasons to close a company include:

• Completion of the business purpose.
• Financial insolvency.
• A decision to consolidate operations.
• Voluntary choice by shareholders or directors.

Once the decision has been made, it’s essential to follow the correct legal steps to ensure compliance and avoid future liabilities.

Steps to Take to Close a Company

We won’t sugar-coat this: closing a company is not the easiest thing. It’s certainly – in our opinion – easier to open a company than close one. But here is what to do:

Step 1: Pass a Resolution

Shareholders’ Resolution or Directors’ Resolution

The process of closing a company begins with a formal resolution. Depending on the company’s structure and operational status, the type of resolution required may vary:

1. Shareholders’ Resolution: If the company has active shareholders, a special resolution must be passed. A special resolution typically requires at least 75% of shareholders (who also hold at least 75% of the voting shares) to agree to the company’s closure. This resolution must be recorded in the company’s minutes.
2. Directors’ Resolution: For companies without active shareholders or where shareholders have delegated authority, the board of directors can pass a resolution to close the company. This decision must also be formally documented. Note that directors can pass this only if the company has a constitution that allows them to authorise removal.

The resolution should specify the reasons for closure and outline the next steps in the process. Keep in mind that the resolution must align with the company’s constitution and the Companies Act 1993.

Step 2: Settle Outstanding Liabilities

Before proceeding further, ensure all outstanding liabilities are settled. This includes paying off creditors, finalizing employee entitlements, and addressing any other financial obligations. You also need to settle shareholder loans and overdrawn current accounts, and account for any assets distributed for less than market value. Failing to resolve these issues can result in legal complications and delay the closure process.

Step 3: Complete the IR315A / Obtain a Letter of No Objection from IRD

What is a Letter of No Objection?

The Inland Revenue Department (IRD) plays a critical role in the company closure process. A Letter of No Objection is a document issued by the IRD confirming that the company has no outstanding tax obligations. This is a mandatory requirement for deregistration.

How to Apply

1. Check Eligibility: The company must have stopped trading, distributed its assets and paid its debts. You can’t apply if the company is in liquidation or the Registrar has already started removal.
2. Prepare and Finalise Financial Records: Ensure all tax returns, including GST, income tax, and employer-related returns, are filed up to date. Cancel GST and employer registrations (if any).
3. Submit an IR315A: Contact the IRD and request a Letter of No Objection. Provide all necessary documentation, including the company’s IRD number and any outstanding tax details.
4. Address Any Issues: If the IRD identifies unpaid taxes or discrepancies, resolve them promptly to avoid delays.

About the IR315A:

Attach the IR315A form to a web message in myIR and use ‘Letter of no objection to removal’ in the subject heading.

In the IR315A you will need to include:

• your company or limited partnership’s IRD number
• the date your business ceased
• the reason your business ceased
• confirmation a final income tax return has been filed, including the period covered
• confirmation any amounts owed have been paid
• confirmation that current account (shareholder loans or credit) is nil
• an authorised person and contact details for any further queries.

Once the IRD is satisfied that all tax matters are in order, they will issue the Letter of No Objection, enabling you to proceed with deregistration.

Step 4: Apply for Deregistration at the Companies Office

Preparing the Application

The New Zealand Companies Office oversees the formal deregistration of companies. To initiate the process:

1. Complete the Online Application: Log into the Companies Office website and access the deregistration section.
2. Submit Supporting Documents: Provide the following:
   • A copy of the shareholders’ or directors’ resolution.
   • The Letter of No Objection from the IRD, no older than 6 months.
   • Any other required documentation, such as evidence of settled liabilities.
3. Confirm Contact Details: Ensure your contact information is accurate, as the Companies Office may need to reach you during the process.

Public Notification

Once the application is submitted, the Companies Office will publicly notify the proposed deregistration. This allows creditors or other interested parties to raise objections if necessary. The public notification period typically lasts for 20 working days.

Step 5: Await Confirmation

The entire process – from submitting the application with IRD to receiving confirmation of deregistration from Companies Office – usually takes about three months. During this time, ensure you monitor communications from the Companies Office and address any queries promptly.

Once the deregistration is approved, the company will be officially removed from the Companies Register, and its legal existence will cease. Note that you must keep records for seven years after removal.

Worked Example 1: Ngaire and Dev Close a Solvent Consulting Company

Ngaire and Dev each own 50% of a small consulting company. The company has stopped trading, has no debts, and holds one laptop. They want it removed from the Companies Register.

They work through the steps in order:

1. Finalise the books. They close the accounts to the date the company stopped trading.

2. File the final return. They file a final company income tax return (IR4) with a profit and loss account and balance sheet to the closure date. They also pay everything the company owes Inland Revenue.

3. Cancel registrations. The company is registered for GST and as an employer. They cancel both in myIR. They also complete the IR315 business cessation form, because IRD says registered companies may need it.

4. Clear the current account. Dev has an overdrawn shareholder current account of $8,000. IRD wants all loans settled, including overdrawn current accounts, so Dev must clear it. Before he chooses how, they check the tax effect with their accountant.

5. Distribute the asset. Ngaire takes the laptop. IRD requires assets to be distributed and accounted for, including assets taken for less than market value. They record the laptop’s market value.

6. Sign the resolution. Each of them holds only 50%, so both must sign to reach 75% of shareholders by number and 75% of voting shares. The resolution carries the date, each person’s full name and signature, and authorises Ngaire to make the application.

7. Request the IRD letter. They sign the IR315A, confirming the final return is filed, the amounts are paid and the current account is nil. Ngaire attaches it to a myIR web message with the subject “Letter of no objection to removal”.

8. Apply to the Companies Office. IRD replies with the letter. Ngaire checks that the company’s annual returns are up to date, then applies online with a copy of the resolution.

9. Keep the records. After removal, they keep the company’s business records for seven years.

Worked Example 2: Wiremu Hits Two Delays

Wiremu is the sole director and shareholder of a small trades company. The company has stopped trading and he wants it gone.

He starts by checking the company constitution. It does not let the directors authorise a removal application. Wiremu therefore uses the shareholder route. He is the only shareholder, so his signature on the special resolution covers 100% of the votes.

He files the final return, settles his tax and requests the IRD letter in March. IRD sends it. Wiremu then checks the Personal Property Securities Register and finds a lender’s financing statement over the company’s work van. The Companies Office says to tell any party with a security interest that you plan to remove the company. Wiremu contacts the lender, but the lender is slow to respond.

He also finds that one annual return is overdue. He files it.

By the time everything is ready, the IRD letter is seven months old. The Companies Office needs a letter that is no more than six months old when you apply. Wiremu asks IRD for a fresh one, and the delay costs him weeks.

The lesson is about order. Check the constitution, the PPSR and the annual returns first. Request the IRD letter last.

Common Challenges and How to Address Them

Unresolved Liabilities

If the company has outstanding debts, these must be addressed before deregistration. Negotiating payment plans or seeking professional advice can help resolve such issues.

Disputes Among Shareholders

Disagreements between shareholders can complicate the process. Engaging a mediator or legal professional may help resolve disputes and facilitate a smoother closure.

Delays in Obtaining the IRD Letter

Ensure all tax filings are up to date and any queries from the IRD are addressed promptly to avoid delays in obtaining the Letter of No Objection.

Final Considerations

Closing a company is a significant decision that involves multiple steps and legal requirements. It’s advisable to seek professional guidance, such as from an accountant or legal expert, to ensure compliance and minimize risks.

By following the steps outlined in this guide, you can navigate the closure process efficiently and with confidence. Remember, while the process typically takes about three months, proactive planning and attention to detail can help avoid unnecessary delays.

Checklist: Closing a Company in New Zealand

Before you start

• ✅ The company has stopped trading, distributed its assets and paid its business debts
• ✅ No creditor is taking action to put the company into liquidation
• ✅ The company is not in liquidation, and the Registrar has not already started removal
• ✅ Directors’ and shareholders’ details and company addresses are up to date
• ✅ All annual returns, and any required financial statements, are filed
• ✅ PPSR checked, and any secured party told about the removal

Approvals

• ✅ Constitution checked for who can authorise removal
• ✅ Special resolution signed by at least 75% of shareholders by number holding at least 75% of voting shares, or a directors’ resolution if the constitution allows it
• ✅ Resolution dated, with each signatory’s full name and signature
• ✅ Every joint shareholder has signed
• ✅ A named person authorised to make the application

Tax clean-up with IRD

• ✅ Final income tax return (IR4) filed, with accounts to the closure date
• ✅ All amounts owed to IRD paid
• ✅ GST and employer registrations cancelled in myIR
• ✅ IR315 completed if the company is registered for GST or PAYE
• ✅ Shareholder loans and current accounts cleared, including overdrawn ones
• ✅ Assets distributed and accounted for, including those taken below market value
• ✅ IR315A sent through a myIR web message

Companies Office and after

• ✅ IRD letter of no objection received, and no more than six months old on the application date
• ✅ Online application lodged with a copy of the resolution
• ✅ Business records stored for seven years after removal

Get Your Company Closure Right the First Time

One missing signature, one overdrawn current account or one out-of-date IRD letter can send you back to the start. Contact EpsomTax.com before you request your letter of no objection. We check your final return, your shareholder current accounts, your GST and employer cancellations and your resolutions, so IRD and the Companies Office have what they need.

If your company owns property, talk to us before you distribute any asset. IRD requires assets taken for less than market value to be accounted for, so the way you move them out matters. Book your company closure review or call us on +64 9-973-0706.

NB This article is general information, not personal tax or legal advice. Check the current requirements on the Inland Revenue and Companies Office websites before you apply.