New Zealand businesses often look to Australia when they are thinking of expansion. Not only does Australia present a breadth of opportunity for business owners, but it also supports many overseas businesses looking to set up shop. Although Australia’s population is six times larger than New Zealand’s, there are many similarities, including a stable political and economic environment. We’ve helped a number of New Zealand businesses expand to Australia. This article will set out some business considerations to factor in before you take a leap across the Tasman Sea.
Australian Business Visas
In Australia, the Department of Immigration and Border Protection is responsible for the issuing of visas. Unsurprisingly, there are various business visas for different purposes depending on the purpose of your visit, your intention, and your business. A Business Innovation and Investment visa is suitable for applicants with business skills who are interested in setting up a new or existing business in Australia. You must be nominated by the state government to be eligible for these visas.
A Permanent Business Talent visa is also available for business owners who own a business in New Zealand and have a net business and personal assets portfolio of at least $1.5 million. Applicants must also have an annual business turnover of at least $3 million. Otherwise, if applicants have obtained $1 million or more in venture capital funding to develop a business, they may also be eligible for the Permanent Business Talent visa.
For those without businesses or venture capital, the Australian Government recently announced Entrepreneur Visas to take effect in November this year. To receive the entrepreneur visa, applicants must obtain funding from a third party and prove a high-growth and innovative idea that can be implemented in Australia.
Business Structuring for Expanding into Australia
If you are looking to expand into Australia, the type of business structure you set up will be critical to your success. Many New Zealanders choose to continue operations in New Zealand as usual and commence their operations in Australia as a non-resident of Australia. Moreover, some business owners choose having no physical presence in Australia through an export-only business structure. This structure is where there is no permanent nor physical presence on Australian shores – a risk-adverse way of testing a product without significant capital outlay.
Establishing an Australian branch is a relatively common option for business owners looking to expand a New Zealand company. Beyond a branch, you can also establish yourself as an Australian subsidiary. A subsidiary structure has a number of benefits, including providing a higher level of risk isolation than a branch. Moreover, subsidiaries may be able to take advantage of tax concessions. In Australia, the tax year commences on 1 July and ends on 30 June.
There’s never been a better time to come and open a New Zealand business in Australia. There are a number of programmes available to assist businesses, including the Australian Business Innovation and Investment Programme. From GST/transfer pricing implications to employment matters, having a business lawyer with experience in helping NZ businesses move to Australia can ensure smooth sailing for your business.