South Africa company registration

For over a decade, Healy Consultants efficiently and effectively assists our Clients i) determine the optimum entity for South Africa company incorporation ii) appropriate business license registration iii) how a South Africa national sponsor will help iv) corporate banking options v) immigration and recruitment strategies and vi) office rental solutions following South Africa business setup.

Advantages of South Africa company registration

Gateway to Africa

  1. South Africa company formation is a gateway to the rest of the continent – a market of nearly a billion people. It is the economic powerhouse of the African continent, with a GDP of US$384 billion, comprising around 30% of the entire GDP of Africa;
  2. South Africa business

  3. Healy Consultants assists our global Clients open a corporate bank account in South Africa for their foreign entities, without the need to incorporate a local company. Our fee for this service is us$3,950;
  4. Over the coming 5 years, South Africa will invite tenders from foreign companies to help develop infrastructure by spending US$82 billion on ports, roads, railway systems, electricity plants, hospitals, schools and dams;
  5. No customs duties when trading with treaty countries. The country is part of the Southern African Customs Union and has free trade agreements with the European Union, European Free Trade Association and Southern African Development Community;
  6. International entrepreneurs interested in South Africa company formation easily obtain bank credit to establish their business. South Africa is ranked number 1 in the world (World Bank’s Ease of Doing Business 2013) in terms of ease of getting access to bank credit.

Continent headquarters

  1. South Africa business setup is an ideal African headquarters because i) wholly foreign owned company is allowed; ii) legal documents are prepared in English; iii) it boasts the best skilled labour in Africa;
  2. The country boasts 71 Double Tax Treaties minimizing withholding taxes on income such as dividends, interest or royalties. With effect from January 2011, headquarter companies are allowed to raise and deploy capital offshore without exchange control approvals;
  3. A foreign owned company can invest in every South Africa business sector without restriction.


  1. South Africa business setup has 4 Industrial Development Zones (IDZs) providing various incentives for investors interested in South Africa company incorporation including i) No VAT or customs duty ii) 15% government grants on cost of plant and machinery acquired abroad iii) 15%-30% grant on cost of machinery, equipment, commercial buildings and vehicles to local and foreign-owned manufacturers iv) compensation to foreign investors pursuing South Africa company incorporation for costs of moving new machinery and equipment from abroad;

    The IDZ’s include South Africa company incorporation in Port Elizabeth (Coega IDZ), South Africa company formation in East London (ELIDZ), South Africa business setup in Richards Bay (RBIDZ) and South Africa company incorporation in Gauteng (or Tambo International Airport);

  2. Due to the abundance of cheap raw materials and labour, South Africa is a manufacturing hub. Skilled labour on an average costs US$1,000 per month, unskilled labour US$100 per month and average office space rental is US$10 per square metre per month. It is one of the favourite locations for manufacturing of automobiles and automotives;
  3. South Africa is currently the world’s most attractive renewable energy market. According to Bloomberg, 2012 investment in renewable energy in the country was US$5.5 billion. The country commits to reduce greenhouse gas emissions by 34% by 2020 and has a great need for more electricity. This is an attractive opportunity for foreign investors interested in pursuing South Africa company registration.


Disadvantages of South Africa company registration

    South Africa business considerations
  1. Taxation is punitive in South Africa. The corporate tax rate is a flat 28% and capital gains tax for companies is 19%. Average import duty is 19%;
  2. To successfully obtain business visa approval for a foreign national, the company must have a capital of at least US$250,000;
  3. The process of funds transfer in and out of South Africa is lengthy and requires approvals by the South African Reserve Bank (SARB);
  4. Compared to western countries, South Africa company incorporation boasts poor business standards. Quality of labour is low, customer service is poor, bank service is poor, it is difficult for a company to be efficient and productive. However, compared to the rest of the continent, it is the most efficient country;
  5. It is difficult to find educated, skilled staff in South Africa. Only 2% of the current population comprises of degree holders. Only 39% of the population speak English fluently, consequently language is a barrier when pursuing South Africa company incorporation;
  6. South Africa company formation is difficult because the government is inefficient, and employees are unproductive and move at a slow pace. Business is not a priority for employees;
  7. Employee unions are strong and there are frequent strikes impacting public service. The 2012 strikes at platinum and gold mines have cost US$400 million in lost production;
  8. One of the biggest business challenges facing multinationals pursuing South Africa company incorporation is government red tape, bureaucracy and corruption. When there is ambiguity about the South African law, it gives rise to corruption and unnecessary delays in executing deals in the country. Consequently South Africa ranked poorly as the 75th least corrupt country on the 2012 global corruption index;
  9. The country is politically unstable because of racial tensions, thus foreign investment is less secure. South Africa is one of the world’s most dangerous countries to live in. Over 43 people are murdered on average every;
  10. The South African Rand is one of the most volatile currencies in emerging markets, this gives uncertainty to the value of foreign investments;
  11. All the bank signatories of a South Africa corporate bank account must be resident of South Africa (citizen, PR or visa holders).

Different South Africa entities

Summary at a glance
Branch office
Rep office
Total company set up costsUS$11,280US$13,280US$12,000
Subsequent annual costs (excl accounting and tax fee)US$2,180US$1,680US$1,440
How long to set the company up?5 weeks7 weeks8 weeks
How long to open company bank account?3 weeks3 weeks3 weeks
Issued share capital requiredNoneNoneNone
Types of business permittedNo restrictionsNo restrictionsOnly research and marketing
Allowed to sign sales contracts with South African clientsYesYesNo
Allowed to invoice with South African clientsYesYesNo
Corporate tax payable28%28%None
Corporate bank accountFirst National Bank or Standard BankFirst National Bank or Standard BankFirst National Bank or Standard Bank
Can rent office premisesYesYesYes
Tenancy agreement required before incorporation?NoNoNo
Allowed to import raw materials?YesYesNo
Allowed to export goods?YesYesNo
Can the entity hire expatriate staff ?YesYesYes
Do you visit South Africa for company incorporation?NoNoNo
Resident director required?NoNoNo
Resident shareholder required?NoNoNo
Minimum number of directors111
Minimum number of shareholders111
Resident company secretaryNoNoNo
Resident public officerYesYesYes
Tax registration certificate requiredYesYesNo
Individual shareholders allowedYesYesNo
Corporate shareholders allowedYesYesNo
Corporate director(s) allowedNoNoNo
Public registerYesYesYes
Employment visa feesUS$3,950US$3,950US$3,950
How long to get work permit approvedUp to 6 monthsUp to 6 monthsUp to 6 months
Statutory audit requiredYesYesNo
Annual tax return to be submittedYesYesNo
Access to South African double tax treatiesYesYesNo

Limited liability company

    South Africa business entity types
  1. A South Africa company formation of a Limited Liability Company (LLC) is the most common entity used for South Africa business setup and is allowed to engage in any commercial or industrial activity. As always, the shareholders enjoy are not personally liable for the company;
  2. A South Africa company formation of an LLC must appoint a minimum of one director and one shareholder of any nationality. There is no minimum issued share capital but it takes 5 weeks to pursue South Africa company formation. Each company must appoint a South Africa resident public officer.

Branch office (external company)

  1. An external company is a company incorporated outside of South Africa, irrespective of whether it is carrying on business in South Africa or not;
  2. An external company must be registered within 20 business days of first beginning to South Africa business setup. It must appoint a minimum of one director and one shareholder of any nationality for South Africa company formation. There is no minimum issued share capital but it takes 7 weeks to register an external company. Each external company must appoint a South Africa resident public officer.

Representative office

Where a foreign company does not intend to carry on business in South Africa, it may seek to establish a South Africa company formation in the form of a representative office. Such an office must however only engage in activities which will not amount to carrying on business, for example market research.

Sole proprietorship

Foreigners are allowed to invest in South Africa as sole traders, in their personal name. This kind of entity is used by doctors, engineers and lawyers.The owner is subject to full personal liability and Profits are taxed according to personal income tax laws and not corporate tax laws.


A South Africa company formation of a partnership is not a legal entity distinct from the persons comprising the partnership, including for income tax purposes. However, for Value Added Tax (“VAT”) purposes, a partnership is a person and therefore registers as a vendor in its own name. Every partner in a general partnership is liable jointly and severally for all the debts and obligations of the partnership.

Business trust

A South Africa business setup of a business trust is constituted by the lodgment of a deed of trust with the Master of the High Court of South Africa. Trusts obtain separate legal personality only for certain purposes, such as for taxation and perpetual succession is usually provided for in the deed of trust. Ownership of the trust assets vests in the trustees who are limited to a maximum of 20 persons. Limited liability can be achieved via the business trust. Trusts are subject to a higher rate of income tax at 40% and capital gains tax at an effective rate of 20%.

Non-profit company

Companies may also be incorporated under the Companies Act which regulates the South Africa company incorporation of non-profit companies / associations not for gain. Such South Africa business setup companies must have as a public benefit object or an object relating to one or more cultural or social activities, or communal or group interests and must apply all of its assets and income to advance its stated objects.


Accounting and tax considerations

    South Africa tax

  1. The corporate tax rate is a flat 28% for South Africa company registration. South African sourced income of non-residents, including the income of South African branches of foreign companies is also taxed at a rate of 28%;
  2. A Value-Added Tax (VAT) of 14% is imposed on enterprises engaged in supply of goods and services in South Africa, if the turnover is more than R300,000 (US$30,000) a year;
  3. Goods exported from South Africa and services rendered offshore or rendered to non-residents of South Africa are generally zero-rated for VAT;
  4. There is no income tax on undistributed profits. Companies that distribute after tax profits by way of dividends are subject to dividend withholding tax of 15%;
  5. The distribution of profits by local branches of foreign companies is not subject to dividend withholding tax. There is no further tax payable on the remittance of South African branch profits offshore. These profits will have been taxed in South Africa;
  6. South Africa is a signatory to Double Tax Treaties with 71 countries including: USA, UK, Germany, Ireland, Japan, China, Brazil, India, Russia, Saudi Arabia, Belgium, Australia, Singapore, New Zealand, Mauritius, Zimbabwe, Botswana, Mozambique, Namibia, Korea, Luxembourg etc;
  7. Income tax on residents is charged on a progressive basis – the lowest being 18% (for taxable income R0-160,000) and the highest being R178,940 + 40% of the amount above R617,000 (for taxable income R617,00 & above);
  8. The maximum effective Capital Gains Tax rates for South Africa business setup are as follows: i) individuals – 13%; ii) trusts – 27%; iii) companies – 19% (the distribution of such profits as a dividend will further incur dividend withholding tax as noted above); and iv) branches of non-resident companies – 19%;
  9. Foreign dividends are subject to income tax in the hands of South African residents. There are exemptions for certain categories of residents, like for those who hold at least 20% shares of the foreign company;
  10. Other taxes for South Africa business setup include: i) customs & excise duty – different rates for different products; ii) securities transfer tax – 0.25% on the greater of the market value or consideration payable; iii) estate duty – 20% on the worldwide estates of deceased person; iv) donations tax – 20% on value of property donated; and v) transfer duty – 10% on value of immovable property for corporate entities and trusts, different rates for individuals;
  11. Application of general transfer pricing rules to financial assistance granted to foreign-owned South African branches since 2011.


South Africa feesSouth Africa company incorporation in Year 1 amount to US$5,480 and annual company costs in Year 2 and thereafter amount to US$2,180. The average total fees per South Africa engagement amounts to US$11,280 including company incorporation, registered office address and company secretary, corporate bank account, and SARS and VAT registration fees. Refer to draft invoice embedded here.

Rep office
1.Average engagement feesUS$11,280US$13,280US$12,000
2.Draft invoice



The average South Africa company registration engagement period for company registration is 11 weeks as outlined below:

1.Engagement planning1 week
2.Company incorporation4-6 weeks
3.Corporate bank account approval3 weeks
4.Corporate internet banking approval2 weeks
Total engagement period10-12 weeks


Compliance considerations

  1. South African law is founded on the Roman-Dutch law, although many aspects of its law, particularly the company laws, have been heavily influenced by English law;
  2. According to South African Law, every South African company must appoint a public officer following South Africa business setup. Most of our clients appoint one of the local staff members as public officer. If required, Healy Consultants will be pleased to be appointed as public officer for our Client’s firm to support South Africa company incorporation;
  3. In accordance with the South African Companies Act, a Company shall as from the date of its incorporation have a legal registered office in South Africa. If required, Healy Consultants’ South Africa business office will be the registered office address for your company following South Africa company registration;
  4. There is no requirement for local shareholders or directors to form a limited liability company in South Africa;
  5. Foreign companies can own real estate in South Africa without any restriction;
  6. South Africa office

  7. The Companies Act, 2008 requires all companies in South Africa to have at least one office address in the Republic, and to register the address with the SA Commission;
  8. The Act requires all companies in South Africa to submit annual returns following South Africa business setup, including a copy of their annual financial statements and any other prescribed information;
  9. The Act requires all companies in South Africa to keep accurate and complete accounting records. All public companies must have audited financial statements and all private companies must have their annual financial statements either audited voluntarily or independently reviewed;
  10. The Act requires lodging of a Notice of Incorporation and Memorandum of Incorporation with the Companies and Intellectual Property Commission (CIPC) at the time of company registration;
  11. Companies that hire employees for South Africa business setup are required to register with the Department of Labor for Unemployment Insurance after incorporation;
  12. Companies are required to register with the Commissioner after South Africa business setup according to the Compensation for Occupational Injuries and Diseases Act. No obligation to wait for the approval of registration to start operations;
  13. The courts are open to foreigners on exactly the same terms and conditions as South African citizens, although many commercial disputes are resolved through arbitration by agreement between the parties;
  14. The Occupational Health and Safety Act requires an employer to bring about and maintain, as far as reasonably practicable, a work environment that is safe and without risk to the Health and Safety of its workers;
  15. Although companies in South Africa are not required to comply with the Broad-Based Black Economic Empowerment Act (B-BBEE Act), it is beneficial for companies to do so in order to gain extra credit for calculation of scores for the awarding of tenders by government organisations in South Africa, and also attract Clients who want to leverage their suppliers’ B-BBEE rating to achieve a higher rating for themselves;
  16. Although a resident director is not mandatory for South African company incorporation, South African banks will only appoint an individual as bank signatory after obtaining evidence that this person has valid residency rights (work visa, PR or citizenship) in South Africa. Thereafter making difficult for our international clients to open South African corporate bank accounts. If required, Healy Consultants will be happy to provide with nominee resident director services. Our annual fees for the same amounts to US$9,550.

South Africa employment visas

South Africa comprehensive relocation servicesFollowing South Africa company incorporation engagement, Healy Consultants assists our Client obtains employment and residence visas from the Immigration Department of South Africa to allow them to live and work in South Africa. We are proud to say that our approval rate is still 100%. Healy Consultants’ fee to assist our Client obtain a work permit is US$4,950 following South Africa company registration.

Business visa

To successfully obtain an entrepreneur visa following South Africa company formation, the company must have a capital of at least US$250,000.


Employment visas for foreign nationals

A foreigner intending to work in South Africa may qualify for one of the following:

  • Exceptional skills work permit (for highly skilled foreign nationals);
  • Intra-company transfer work permit (for foreigners transferred by foreign company to work at its South Africa branch);
  • Quota work permit (for foreigners with scarce skills);
  • General work permit (for foreigners not qualifying for quota work permit).

Visitor’s visa

  • A foreigner may apply for a Visitors’ Visa for the following reasons of visit (if he is not a passport holder of a visa exempt country): Holiday, business, attending conferences, study purposes not exceeding three months, medical treatment not exceeding three months, academic sabbatical, research, voluntary or charitable activities;
  • The maximum period for a visitor’s visa is 90 days, but it can be extended for another 90 days.

Visa costs and timelines

Processing time
Government fees
Business permitUp to 6 monthsUS$152
Exceptional skills work permitUp to 1 monthUS$152
Intra-company transfer work permitUp to 6 monthsUS$152
Quota work permitUp to 1 monthUS$152
General work permitUp to 6 monthsUS$152
Visitor’s visa5-10 working daysUS$4.25



Corporate banking options

    South Africa financial services
  • Healy Consultants assists our global Clients open a corporate bank account in South Africa for their foreign entities, without the need to incorporate a local company. Our fee for this service is us$3,950;
  • South Africa banking systems boasts 80 commercial banks in the country compromising a mix of local banks, foreign banks, branches and representatives of foreign banks and others;
  • To receive the best internet banking and customer service for South Africa business setup, Healy Consultants recommends the First National Bank and Standard Bank among the local banks, and Citibank, HSBC as well as Standard Chartered Bank among the international banks. Refer to table below to view different banking options for South Africa business setup:
  • International banks in
    South Africa
    Local banks in South Africa
    Standard Chartered BankFirst National Bank
    CitibankStandard Bank

  • Healy Consultants’ South Africa company registration Compliance Team can open an international corporate bank account within 3-4 weeks of South Africa company formation. There is a 50% chance that the Client will have to travel in order to open the account, though Healy Consultants makes every effort to minimize this probability. Following bank account approval, the preferred bank will directly and independently email our Clients the corporate bank account number;
  • Banks in South Africa provide full range of corporate bank account facilities including multiple currencies, internet banking, telephone banking, checking accounts, savings accounts, debit and credit cards, fixed term deposits and wealth management services;
  • Customer service standards of international banks in South Africa are poor. They are unable to provide instant information or advise foreigners about different corporate banking options. Thus Healy Consultants recommends South African local banks for our Clients;
  • Healy Consultants can open a local corporate bank account for a foreign company. Many of our Clients use a local corporate bank account to receive payments and pay suppliers without the need to register a local company. Our fee for this service will be US$4,950.

Trade finance

South Africa company registration finance


Foreign exchange controls

  • Companies registered in South Africa are subject to exchange controls. Non-residents are not subject to exchange controls and can freely transfer funds into and out of South Africa;
  • All investments by non-residents into South Africa must be reported to the South African Reserve Bank (SARB);
  • South Africa company formation of a resident companies can freely remit dividends to their non-resident shareholders;
  • Non-resident shareholders can freely repatriate sale proceeds of shares in the resident company from South Africa;
  • All fund transfers out of South Africa, such as payment to foreign suppliers or remitting funds to parent companies, requires registering the foreign entities with SARB, submitting agreements to the South African banks and waiting for 2 – 3 weeks for execution;
  • Foreign loans taken by South Africa company formation of a resident companies require prior approval from SARB. Permission is usually granted easily;
  • With respect to investments in residential property and financial investments (like portfolio investments, hedging, repurchase agreements etc.), resident companies owned more than 75% by non-residents, can obtain local funding for amounts no higher than the total investments by non-resident shareholders.


Success tips when doing business in South Africa

    South Africa doing business tips
  1. Foreign companies must appoint a local resident to take care of business errands and liaise with government agencies and local authorities. Foreign companies should be patient as much as possible as business procedures in South Africa take a long time;
  2. Your joint venture partner or South African shareholder must not merely be a nominee, you should choose a partner that actually brings a lot to the table, including local knowledge necessary for your business to succeed;
  3. Because South African companies are not all well versed with international trade, we encourage our Clients to consistently use and sign contracts of service;
  4. It is important to include delivery dates in contracts. Deadlines are often viewed as fluid rather than firm commitments;
  5. Grants and other funding programs are available from the local government. There are grants and other assistance available in categories, including manufacturing, innovation and exporting. Healy Consultants assists our Clients locate the grants and assistance programs most relevant to your business;
  6. Entrepreneurs completing South Africa company incorporation can benefit from its numerous Intellectual Property laws. Healy Consultants will assist our Clients with trademark and patent registration. Registering your brand, trademark and designs is particularly important. Note that brands and trademarks can be registered in the name of foreign entrepreneurs pursuing South Africa company registration;
  7. Healy Consultants offers a comprehensive range of research services including i) industrial or business analysis ii) economic and political overview iii) competitor analysis iv) customer analysis v) regulation analysis vi) market entry strategies and vii) business partner matching;
  8. Foreign companies should be aware i) statistics and market data are usually imprecise ii) transactions tend to take longer than expected iii) more frequent and longer market visits are required, at least initially iv) complex business procedures are common;
  9. There are major differences in communication styles in South Africa depending upon the individual’s cultural heritage;
  10. Most South Africans, regardless of ethnicity, prefer face-to-face meetings to more impersonal communication mediums such as email, letter, or telephone. They often use metaphors and sports analogies to demonstrate a point;
  11. It is advisable for foreign entrepreneurs pursuing South Africa company registration to start negotiating with a realistic figure because generally South Africans do not like haggling over prices;
  12. During business meetings, South Africans spend some time discussing things in general and then once they are comfortable will talk business with you. Expecting them to directly come to the point and discuss business is seen as rude and must be avoided;
  13. South Africans follow the European approach to personal space, meaning people keep their distance when speaking. Unlike American cultures they do not appreciate touching and the like;
  14. Being an outdoor nation they love sports and this is always a good topic to start a conversation. Other good topics of conversation include food, wines and international travel. Topics to avoid are comparing cities as people are very proud of their own cities and do not like being told that another city is better. It is not advisable to raise controversial subjects such as race relations or local politics;
  15. Although the majority of businesses work in English, there may be occasions where having materials translated into Afrikaans could make a good impression, especially if you are working with an Afrikaans company in areas like Bloemfontein or Pretoria.
  16. Do’s and don’ts of doing business in South Africa (Video)

Did you know about South Africa?

  1. South Africa has 11 official languages;
  2. It is the only African country that is a member of the G20;
  3. The country is the first country in Africa to have hosted the prestigious FIFA World Cup (2010);
  4. South Africa is the sole producer of the Mercedes Benz C Class, right-hand drive vehicles;
  5. General Motors South Africa will be the only manufacturing site outside of the United States to build the Hummer H3 vehicle;
  6. South Africa has the longest wine route in the world and the oldest wine industry outside of Europe and the Mediterranean, featuring Chardonnays, Pinot Noir, Merlot, Cinsault, Riesling, Shiraz, Sauvignon Blanc, Cabernet Sauvignon and Pinotage varietals;
  7. The vast majority of South African coal exports are shipped through the Richards Bay Coal Terminal (RBCT). With the capacity to export 91 million tons annually, RBCT is the world’s largest coal export facility;
  8. The deepest mine of the world is a gold mine in South Africa. In 1977 the Western Deep Levels Mine reached a depth of 11,749 feet. Most mines descend to about 3,300 feet;
  9. South Africa is the second largest exporter of fruit in the world;
  10. It generates two-thirds of Africa’s electricity;
  11. There are about 280,000 windmills on farms across the country, second in number only to Australia;
  12. South Africa is the only country in the world to voluntarily abandon its nuclear weapons program;
  13. It has 19,004 miles of railway track – 80% of Africa’s rail infrastructure;
  14. The only street in the world to house two Nobel Peace prizewinners is in Soweto. Nelson Mandela and Archbishop Desmond Tutu both have houses on Vilakazi Street in Soweto.

Useful links

External readings

External videos

The following are some of the most frequently asked questions about South Africa company formation:

How many directors are required for starting a business in South Africa?

When registering a company in South Africa, only 1 director needs to be appointed.

How many shareholders are mandated when starting a company in South Africa?

For business registration in South Africa, at least 1 shareholder are required.

Is it mandatory to have a resident director or shareholder for Company Registration in South Africa?

No. Resident director/shareholders are not required for registering a company in South Africa.

Will there be restrictions in ownership if foreigners setup a South Africa company?

No. 100% foreign ownership is allowed if you wish to setup your business in South Africa.

How to open a company in South Africa?

For company formation and business establishment in South Africa, Healy Consultants will prepare the appropriate documentation and notarize them. We will also assist the Client with opening their corporate bank account in South Africa.

How to register a business in South Africa?

For business registration, our Client will be required to i) reserve the company name ii) supply the South Africa office lease agreement iii) sign the company setup forms iv) register for tax and social security and v) obtain a business license.

Healy Consultants’ experts are South Africa company registration specialists and will assist our Clients at every step.

Can Healy Consultants assist my firm with South Africa subsidiary company registration?

Yes. Our South Africa company registration services include i) business registration ii) business license registration iii) immigration solutions iv) employment strategies v) business banking solutions and vi) office rental requirements.

Will details of my South Africa business formation be available for public viewing?

Yes. In order to start a South Africa company, an entrepreneur must enter the business details in the public register.

Can a business formation in South Africa be a secure long term solution?

Yes. A South African business allows our Clients an opportunity to access the most affluent market in the African continent. Furthermore, various government funding options like grants and loans will be available for young businesses.

Will I be required to get a full audit if I setup a small business in South Africa?

No. Audit is not mandatory for small businesses in South Africa.

Contact us

For additional information on South Africa company formation, you can email us at or phone us at (+65) 6735 0120. Address: E8 Somerset Office Estate, 971 Kudu Av, Allens NEK X 27, Roodepoort, Gauteng, South Africa.