Buying a business on the other side of the Tasman

There’s something wonderfully bold about buying a business in another country. Maybe it’s the café in Queenstown you’ve walked past every ski season, or the joinery in Toowoomba that a Kiwi supplier has been eyeing for years. Mr loves this kind of adventure. But a business purchase across the Tasman has twice as many places for surprises to hide, so here’s his step-by-step.

Step 1: Fall in love slowly

The best purchases start with curiosity, not commitment. Before you make an offer:

• Spend time in the business. As a customer, then (with the seller’s agreement) behind the counter.
• Talk to suppliers and neighbours. Are they loyal to the business, or to the owner?
• Understand the local market. Regional economies on both sides move differently. A tourism town’s winter is not a city’s winter.
• Ask why it’s for sale. Retirement, burnout and a better opportunity are all fine. A lease ending or a big customer leaving are things you need to know.

Step 2: Do the due diligence properly

Both governments publish good checklists. business.gov.au says you should review the financials, how the business runs and its legal paperwork before signing, and lists:

• licences and permits, and whether they transfer;
• contracts and leases, and whether they can be assigned;
• supplier agreements;
• equipment condition, assets and intellectual property;
• inventory levels;
• outstanding debts and liabilities; and
• three to five years of tax returns, business activity statements, receivables, payables, balance sheets, profit and loss statements, cash flow statements and sales records.

It also recommends checking the Personal Property Securities Register (PPSR) for debts secured over the business’s assets.

business.govt.nz adds the New Zealand angle: pending court cases or disputes, whether the business owns and can transfer its key assets, employment and supply contracts, key staff and retention risk, customer and supplier loyalty, and getting an accountant to go through the books, trends and forecasts. New Zealand has its own PPSR too.

Mr’s tip: use an accountant and a lawyer in the country where the business is. A great adviser at home may not know the other side’s traps.

Found the one and need to fund it? Business purchase funding is considered case by case on both sides, and asking won’t touch your credit file. Pick your country and start a 60-second enquiry.

Step 3: Choose who’s buying

This is where trans-Tasman purchases differ most from local ones. Your options usually include:

Buyer	How it works	Weigh up
A new local company	Set up a company in the business’s country to buy it	Clean start; local track record; needs local registrations and director arrangements
Your existing company	Your home-country company buys and registers in the other country	One entity; brings the other country’s obligations into it
You personally	Buy as a sole trader	Simple, but personal liability; harder to scale
A trust	A trustee buys for a family or trading trust	Flexible, but more paperwork and lender scrutiny

In New Zealand, a company needs at least one director who lives in New Zealand, or who lives in Australia and is a current director of an Australian company, which suits many Australian buyers. In Australia, a proprietary company needs at least one director living in Australia, and every director needs a director ID before appointment.

Structure affects tax, liability and lending. Decide with advisers in both countries before you sign. Our business structures side by side is a helpful starting point.

Step 4: Get the sale agreement right

A few clauses matter even more across borders:

• GST. In New Zealand, business.govt.nz says the agreement should state whether the price is GST inclusive or exclusive and the rate (15% or 0%). In Australia, a sale of a going concern can be GST-free if the conditions are met. Don’t assume; confirm.
• Stock and work in progress. How they’re valued on settlement day.
• Staff. Which employees transfer, and what happens to their leave and entitlements.
• Lease assignment. The landlord’s consent and any changed terms.
• Restraint of trade. So the seller can’t set up a rival around the corner.
• Finance clause. Make the deal conditional on funding approval, with enough time.

Step 5: Fund the purchase

Lenders on both sides ask three questions about business purchases:

1. Is the business solid? History, cash flow, customer concentration and the reason for sale.
2. Is the buyer credible? Relevant experience, your own contribution, your credit file, and a plan for the first year.
3. What’s the security? Property makes a big difference, and lenders usually want it in their own country.

Property-secured funding sits between $20,000 and $5,000,000, using a home or commercial property through a first mortgage, second mortgage or caveat. Unsecured and cash-flow options (usually between $5,000 and $500,000) rely on trading figures, which can be harder for a business that’s just changing hands.

The location of your property often decides where the funding conversation starts. See which country to apply in. The single-country sites also cover this: the Australian site on borrowing to buy a business and the New Zealand site on buying a business in NZ.

Step 6: Set up before settlement

Don’t wait until the keys are in your hand. Before settlement:

• Australia: company registered with ASIC (if buying through a company), director IDs, ABN, GST registration if turnover will reach $75,000, payroll and super set up for Payday Super.
• New Zealand: company incorporated (or overseas company registered within 10 working days of starting activities), NZBN, GST registration if turnover will reach $60,000, payday filing and KiwiSaver set up at 3.5%.
• Both: business bank account, insurance, supplier accounts, and the handover plan with the seller.

Questions to ask the seller across the water

Distance makes some questions more important. Mr’s shortlist for any trans-Tasman purchase:

1. Which customers and suppliers are tied to you personally? If the seller’s relationships walk out the door, so might the revenue.
2. What’s the tax position? Ask for confirmation that GST, payroll obligations and income tax are lodged and paid, or under a formal arrangement. Tax debts can follow assets or affect the business’s standing.
3. Are there any registered security interests? Search the PPSR in the business’s country and ask the seller to explain anything you find.
4. What does the lease really say? Renewal options, rent reviews, make-good obligations and whether the landlord will agree to the lease being assigned.
5. Which licences and permits transfer? Food, liquor, trade and environmental permits can be personal to the current owner.
6. What are staff entitled to? Leave balances, notice periods and, in Australia, super paid up to date under Payday Super; in New Zealand, KiwiSaver contributions at the current rate.
7. How seasonal is the business? Tourism, agriculture and construction all have strong seasons on both sides of the Tasman, so ask to see monthly figures, not just annual totals.

Write the answers down and give them to your accountant and lawyer. They’re also exactly the details a lender will ask about.

Illustrative example

Illustrative only. A couple from Adelaide buy a boutique accommodation business in Queenstown. They form a New Zealand company with one of them as director (he directs their Australian company, so he meets the residency rule) and have a Queenstown lawyer and accountant review the books, leases and staff contracts. The agreement states the GST treatment clearly. Because their property is in South Australia, they arrange part of the funding on the Australian side against their home, with the plan to look at local New Zealand working capital after twelve months of running it themselves.

Your pre-offer checklist

• Spend real time in the business.
• Line up an accountant and lawyer in the business’s country.
• Request three to five years of records.
• Search the PPSR for security interests.
• Decide the buying entity with advice from both sides.
• Confirm GST treatment and the finance clause.
• Talk to a lender early, in the right country.

Ready to make an offer?

Buying a business across the Tasman is bold, exciting and very doable with the right preparation. When you want to talk funding, the first step is easy: no credit check for an enquiry, no circulating your details through the lending market, and a person in the right country who looks at the deal properly. Share accurate figures for the business, your contribution and any property, and you’ll get a straight answer. Pick your country and see if you qualify.