Disposing of surplus assets
How to dispose of your society’s surplus assets if it is ceasing, or has ceased, to operate
The Incorporated Societies Act 2022 (the Act) sets out the rules for disposing of surplus assets. These apply if your society closes down or goes into liquidation. Its surplus assets are what remains after your society has paid its debts, costs, and liabilities.
In your society’s constitution it must nominate 1 or more not-for-profit entities to which the society’s surplus assets may be distributed. Instead of naming specific entities your society may nominate a class or description of not-for-profit entity. When deciding what to do, you should start by checking your constitution.
In some cases, you may be able to apply to the Registrar of Incorporated Societies for directions for distributing surplus assets.
In this guide
Who can apply for directions
Only some people can ask the Registrar to direct how your society’s surplus assets will be distributed.
To apply you must be one of the following.
- A member of your society.
- If your society has been removed from the register, a former member can apply.
- A solicitor or other professional may apply on behalf of a member or former member.
- A liquidator, receiver or statutory manager of your society.
You can also apply if:
- you are authorised by the society to do so, and
- the society cannot dispose of its surplus assets as outlined in its constitution.
Grounds for applying
If possible, your society should work to resolve the issue of distributing surplus assets. Follow your constitution and the rules set out in the Act.
There are some situations where you can apply for directions from the Registrar, including the following.
- When the not-for-profit entity named in your society’s constitution no longer exists.
- When your society has been removed from the register, so it is unable to carry out the processes outlined in its constitution and the Act.
- You should first consider whether it is more appropriate to apply to have your society restored to the register.
The information you will need to provide
Apply in writing for directions from the Registrar. Your application must include the following.
- The society’s name and its registration number or New Zealand Business Number (NZBN).
- Your details as the applicant and the role you play in the society.
- The grounds for your request.
- Details of the surplus assets that are to be distributed.
- Accurately describe the assets so they can be clearly identified.
- In the case of land, include a copy of the Record of Title from Land Information New Zealand (LINZ).
- Details of any costs, debts, and liabilities that may need to be dealt with.
- Details of the not-for-profit entity or entities you believe should receive the surplus assets.
- Confirmation that the surplus assets are not subject to any legal claims or proceedings.
- Confirmation that no individual has a beneficial ownership in or claim over the surplus assets.
- Confirmation that the recipient organisation is willing to accept the surplus assets.
You can also nominate a relevant person to carry out the Registrar’s directions. That person could be:
- An officer of the society or, if the society has been removed from the register a former officer.
- A current officer of the entity or entities that will receive the surplus assets.
- An accountant or solicitor.
- An appropriate person within a financial institution.
There is no fee to apply for these directions.
Our address for applications
Email your written application to us: compliance@companiesoffice.govt.nz
The Registrar will consider your application
We will review your application. If we have any questions, we will get in touch with the person who submitted it and let you know what we need.
Once our review is complete, we will email you to confirm whether we have accepted your application.
If the Registrar accepts your application, we will issue directions for disposing of the surplus assets.
Public notice and the right to appeal
Directions issued under the 1908 Act
If we issue directions under the Incorporated Societies Act 1908, we will:
- give public notice of the intended directions, and
- provide a period of 1 month for any appeals.
The notice is published on the Incorporated Societies Register website and the New Zealand Gazette.
News and
Once the notice has been published, the public has 1 month to appeal the Registrar’s decision. We will email you if we receive any appeals.
Directions issued under the 2022 Act
If we issue directions under the Incorporated Societies Act 2022 there is no right of appeal, and we do not give public notice of the decision.
The directions must then be carried out
Once the decision is final, the directions must be carried out. It is not the Registrar’s role to distribute the surplus assets; that responsibility sits with the person nominated to carry out the directions.
Other guides in
Ending an incorporated society
- Applying to remove your society from the register
- Objecting to removal
- Placing a society into liquidation