Business entities in Afghanistan
Healy Consultants will advise our Client with determining the optimum corporate structure for satisfying their business needs. Generally, the most commonly preferred business entity is the limited liability company. However, our Clients may also choose either to incorporate a corporation or register a branch office. For more details, please refer to the information below.
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Limited liability company
- This Afghanistan business setup is recommended for entrepreneurs looking to enter the country. Under this entity, the shareholders can only be liable to the extent of capital invested in the company;
- The LLC can be incorporated with 1 director and 2 shareholders, all of whom can be non-Afghan residents. However, a resident company agent and a board of supervisors must also be appointed. Lastly, there is no mandated minimum share capital requirement for the setup of this entity.
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Corporation
- Alternatively, our Clients may choose to setup a corporation. This Afghanistan business setup is recommended when our Clients wish to issue shares to the public;
- Like an LLC, a corporation must have i) 1 director & 2 shareholders ii) resident company agent and iii) a board of supervisors.
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Branch Office
- Lastly, our corporate Clients can register a branch of their entities in Afghanistan. The branch entity will not be considered separate from its parent entity. Therefore, the parent entity will be liable for all losses incurred by its branch office;
- While a branch office will not appoint directors or shareholders, it will be required to appoint 1 legal agent, who must be resident in the country.
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Comparison of Afghanistan entities
LLC Branch office Corporation How long to set the company up? 7 weeks 8 weeks 8 weeks How long to open company bank account? 4 weeks 4 weeks 4 weeks Legal liability? Limited Unlimited Limited Wholly foreign owned? Yes N/A Yes Minimum share capital? US$1 N/A US$1 File annual tax return? Yes Yes Yes Tax registration certificate required? Yes Yes Yes Recommended corporate bank account? Afghanistan International Bank New Kabul Bank Azizi Bank Does our Client need to travel? No No No Resident director required? No N/A No Resident shareholder required? No N/A No Minimum directors required? 1 N/A 1 Minimum shareholders? 2 N/A 2 Tax identification code (TIN) needed? Yes Yes No Afghanistan resident company agent required? Yes Yes Yes Corporate shareholders allowed? Yes N/A Yes Corporate director(s) allowed? No N/A No Afghanistan corporate tax rate? 20% 20% 20% Annual financial statements required? Yes Yes Yes Statutory audit required? Yes Yes Yes Regulated by? Afghanistan Central Business Registry Afghanistan Central Business Registry Afghanistan Central Business Registry Allowed to issue sales invoices? Yes Yes Yes Allowed to sign contracts? Yes Yes Yes Allowed to import and export goods? Yes Yes Yes Can rent an office space in Afghanistan? Yes Yes Yes Can buy Afghanistan property? Yes Yes Yes Can own equity in other Afghanistan companies? Yes Yes Yes Total Afghanistan business setup costs in Yr. 1 US$30,650 US$33,550 US$30,450 Subsequent annual costs (incl. accounting and tax fee) US$11,150 US$12,150 US$11,050 Sample engagement invoice View invoice PDF View invoice PDF View invoice PDF -
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