When starting your business, you will need capital. Luckily, the New Zealand government offers many grants and tax incentives to help start-ups get up and running in no time. This article will outline some critical government grants and tax incentives available for your start-up.
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Flexi-Wage for Self-Employment Grant
Flexi-wage for self-employment is a Work and Income New Zealand (WINZ) grant. It is designed to help those starting a brand-new business or needing help becoming self-sufficient in an existing business. You can be awarded up to $600 weekly for up to 28 weeks. To be eligible for this grant, you need to be:
- out of work;
- over 18;
- having hardship in getting or keeping a job;
- getting a benefit and have not worked for a long time; and
- ordinarily reside in New Zealand.
Your business must also meet specific requirements, such as drafting a business plan. This is because WINZ can only confirm that your business idea is viable with a business plan. In this sense, you need to be:
- interested in starting a business; or
- not self-sufficient in the early stages of developing your business.
Apart from the criteria you need to meet, there are some circumstances in which you cannot get this grant. Namely, you cannot get flexi-wage for self-employment if you are:
- re-starting a business you have owned before;
- already running an established company that is struggling financially; or
- bankrupt.
Self-Employment Startup Payment
The self-employment startup payment can help if you are starting a business or need help with start-up costs, such as equipment or your first lot of stock. You must call WINZ to apply and remember to be prepared with a business plan. To be eligible for this grant, you need to be:
- out of work;
- over 18;
- disadvantaged in the labour market, such as experiencing difficulty in getting or keeping a job;
- risk of long-term benefit dependency; and
- meet the residency criteria.
Apart from personal requirements, you also need to be:
- starting a new business; and,
- have essential start-up costs you need help with.
However, you cannot get this grant if you are:
- bankrupt; or
- re-starting a business you have owned before.
If WINZ accepts your grant application, they can pay for certain things. How much you get depends on your situation. Nevertheless, they may pay for things such as:
- equipment;
- start-up stock;
- materials;
- first month’s lease;
- legal costs;
- insurance;
- printing business cards; and,
- setting up a basic website.
Getting Started Grants
Callaghan Innovation provides this grant to fund companies focusing on research and development (R&D). The grant aims to help move your product from development to commercialisation. This grant can benefit you by helping you:
- launch your R&D activities;
- prototyping, project planning, troubleshooting, and determining user requirements and specifications; and
- access technical expertise.
Your business is only eligible if it is:
- registered under the Companies Act or the Limited Partnerships Act; or
- is a Māori incorporation or trust under the Te Ture Whenua Māori Act.
Once you have applied and are accepted, you can get the following:
- 40% of your R&D project costs or up to $5,000;
- receive funding for R&D done in New Zealand; and
- receive a one-off payment on completion of the project.
Student Grants
Callaghan Innovation also offers student grants to help undergraduate and postgraduate students gain and develop technical skills in a commercial environment. It also supports businesses in boosting their R&D capability with students working for them to gain experience. There are three types of student grants:
| Grant Type | Explanation |
| R&D Experience Grant | A 10-week internship where a student can help your business with an R&D project. |
| R&D Fellowship Grant | Provides funding for students undertaking a PhD or master’s degree aimed at solving a technical or scientific problem. |
| R&D Career Grant | Internship to provide 6-month employment for recent PhD or master graduate students. |
Research and Development Tax Incentive
This R&D tax incentive is aimed at helping more businesses innovate to contribute to a more robust economy. You may be eligible if the R&D you undertake seeks to resolve scientific or technological issues. In saying that, your R&D expenditure must be at least $50,000 per annum. The main features of this incentive include a:
- credit rate of 15%;
- $120 million cap on eligible expenditure; and
- limited form of refundability.
Key Takeaways
Many government grants and tax incentives are available to help start your business. The main grants and tax incentives you should be aware of include the:
- Flexi-Wage for Self-Employment grant;
- Self-Employment Startup Payment grant;
- Getting Started grant;
- Student grants; and
- Research and Development Tax Incentive.
If you need help understanding what government grants or tax incentives your start-up can apply for, our experienced start-up lawyers can help as part of our LegalVision membership. You will have unlimited access to lawyers who can answer your questions and draft and review your documents for a low monthly fee. Call us today on 0800 005 570 or visit our membership page.
Frequently Asked Questions
You are eligible for a flexi-wage grant with an existing business if you cannot be self-sufficient with your existing business. However, you will not qualify if you are re-starting an existing business.
A getting started grant can help boost your start-up’s R&D capabilities. It can help you develop your ideas, commercials them and launch your business in the market.
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