For my first post sharing some of my learnings, I’m kicking it off with some key information about being a sole trader.
You know the following terms and phrases:
- working for yourself
- being your own boss
- independent contractor
Many who identify with the above are suited to being a sole trader. ‘Sole trader’ is the official business structure accepted by the government and other businesses. It’s a way of formally recognising your business. As a sole trader, you’re generally looking to start business alone and keep things simple.
Being a sole trader is different from the ‘limited’ business structure in a few ways, mainly you’re personally responsible for all finances. You can find out more about the different business structures and which is best for you here.
Do I have to register as a sole trader to work for myself?
It’s not a legal requirement yet in New Zealand to do so, but it could become one. My advice is to register as soon as possible because (#1 point that persuaded me) it’s FREE. You never know when the government might start charging for it, so you may as well do it now while it doesn’t cost you anything. Plus it is a quick and easy online form to fill in, it only takes a few minutes. Once you’re done, you have your very own NZBN (New Zealand Business Number) and you’re officially registered! Take it as a small victory, yet a big milestone, that was actually easy to achieve.
How do I register as a sole trader?
You can do it here on the government NZBN website. Before you can register, you do need to have:
- An IRD number (if you’re working for yourself, this should be your personal IRD number – if you’ve had a job before you should already have one and can find it on IRD’s website or give them a call).
- A RealMe account (you may already have one set up but if not, you can do so here. For me, I had already done this back when I applied for an 18+ card).
- Proof of your identity (this is super easy if you have a NZ driver’s licence).
Where can I find out more about becoming a sole trader?
You can read plenty more about becoming a sole trader, your responsibilities, and other business related information on the government business website here.
Note: the above information is aimed toward people looking to start business in New Zealand.