DOING BUSINESS IN BOTSWANA IN 2024
Since 2003, Healy Consultants Group has assisted our Clients with business registration in Botswana. Our services include i) Botswana company incorporation ii) government license registration iii) corporate bank account opening in Botswana iv) employee recruitment v) visa strategies and vi) office rental solutions in Botswana.
Compare different Botswana entities | LLC | IFSC company | Fast setup solutions | Public limited company | Representative office | Branch office |
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Best use of company? | All purposes | Offshore financial services |
Client to fast close local deal | To secure public funding | Marketing/ research | Specific projects |
How soon to invoice Clients? | 10 weeks | 4 months | 3 weeks | 14 weeks | 4 months | 4 months |
How soon can you hire staff? | 10 weeks | 4 months | 3 weeks | 14 weeks | 4 months | 4 months |
How soon can you sign a lease agreement? | 2 weeks | 2 weeks | 3 weeks | 2 weeks | 2 weeks | 2 weeks |
How long to supply corporate bank a/c? | 14 weeks | 18 weeks | 3 weeks | 18 weeks | 21 weeks | 21 weeks |
How long to supply co. reg / tax numbers? | 10 weeks | 4 months | 3 weeks | 14 weeks | 4 months | 4 months |
Corporate tax rate on annual net profits? | 22% | 15% | 22% | 22% | 0% | 30% |
Limited liability entity? | Yes | Yes | Yes | Yes | No | No |
Minimum paid up share capital? | US$1 | US$1 | US$1 | US$1 | None | None |
Government grants available? | Yes | No | Yes | Yes | No | Yes |
Govt approval required for foreign owners? | No | Yes | No | No | No | No |
Can bid for Government contracts? | Yes | No | Yes | Yes | No | Yes |
Corporate bank account location? | SCB Botswana | Barclays | FNB Botswana | Stanbic Bank | SCB Botswana | Barclays |
Can secure trade finance? | Yes | Yes | Yes | Yes | No | Yes |
VAT payable on sales to local customers? | 12% | 0% | 12% | 12% | 0% | 12% |
Average total business set up costs? | US$23,455 | US$11,405 | US$29,405 | US$13,505 | US$9,850 | US$15,600 |
Average total engagement period? | 4 months | 5 months | 5 months | 5 months | 6 months | 6 months |
Accounting and tax considerations | LLC | IFSC company | Fast setup solutions | Public limited company | Representative office | Branch office |
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Statutory corporate tax payable? | 22% | 15% | 22% | 22% | 0% | 30% |
Legally tax exempt if properly structured? | No | No | No | No | Yes | No |
Must file an annual company tax return? | Yes | Yes | Yes | Yes | Yes | Yes |
Must file annual financial statements? | Yes | Yes | Yes | Yes | Yes | Yes |
Must appoint an auditor? | Yes | Yes | Yes | Yes | No | No |
Access to double taxation treaties? | Yes | Yes | Yes | Yes | No | Yes |
WH tax on payments to foreign s/holders? | 8% | 0% | 8% | 8% | None | 0% |
Company Registration | LLC | IFSC company | Fast setup solutions | Public limited company | Representative office | Branch office |
Minimum number of directors/managers? | 1 | 1 | 1 | 2 | 1 | 1 |
Min. number of shareholders/partners? | 1 | 1 | 1 | 7 | Parent company | Parent company |
Maximum shareholding for foreigners? | 100% | 100% | 100% | 100% | 100% | 100% |
Minimum statutory paid up share capital? | US$1 | US$1 | US$1 | US$1 | None | None |
Shelf companies available? | Yes | No | Yes | No | No | No |
Time to incorporate a new entity? | 10 weeks | 16 weeks | 3 weeks | 14 weeks | 16 weeks | 16 weeks |
Can easily convert to a PLC? | Yes | No | Yes | Yes | No | No |
Public register of s/holders and directors? | Yes | Yes | Yes | Yes | Yes | Yes |
Can have preference shareholders? | Yes | Yes | Yes | Yes | No | No |
This entity will likely be regulated by? | MTI | IFSC | MTI | MTI | MTI | MTI |
Business Considerations | LLC | IFSC company | Fast setup solutions | Public limited company | Representative office | Branch office |
Good entity for trademark registration? | Yes | No | Yes | Yes | No | Yes |
Can secure an import and export license? | Yes | No | Yes | Yes | No | Yes |
Res. director/partner/manager required? | Yes |
Sponsorship by a local citizen required? | No |
Our Client must travel to Botswana? | No |
Temp. physical office solutions available? | Yes |
You need a local resident as bank signatory? | No |
Can be wholly foreign owned? | Yes |
Security deposit kept with government? | No |
Monthly VAT reporting to the Government? | Yes |
Must sign an office lease agreement? | Yes |
S/holder/director docs attested/translated? | Yes |
Foreign non resident director needs work permit? | No |
Maximum number of staff allowed? | None |
Expatriate to local staff ratio? | None |
Can secure residence visa for business owner? | Yes |
Group HQ tax incentives available? | Yes |
Other useful information | |
What is included in my cust. sales invoice? | Click here |
Botswana has signed free trade agreements? | Yes |
This country is a member of WIPO/TRIPS? | Yes |
This country is a member of the ICSID? | Yes |
Average custom duties suffered? | 5.3% |
Average monthly office rental? (US$ per sq m) | US$25 |
Minimum statutory monthly salary? | Depends on the business |
Average US$ salary for local skilled staff? | US$1,550 |
US$ deposit interest rate? (1 year average) | 2% |
Overseas remittance currency controls? | None |
Banking considerations | |
Multi-currency bank accounts available? | Yes |
Corporate visa debit cards available? | Yes |
Quality of e-banking platform? | Satisfactory |
Crowd funding available in this country? | Yes |
Botswana business setup summary
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Advantages and Disadvantages
Advantages of Botswana company registration
- A Botswana Limited Liability Company (LLC) requires only one shareholder and one director, with no restrictions on foreign ownership. There is also no minimum paid-up capital to register a company in Botswana;
- Botswana has been a member of the World Trade Organization since 1995 and thus, enjoys all the benefits that membership provides;
- The economy of Botswana is benefited by the world’s largest diamond market, producing over 30 million carats annually. Diamond exports have ensured an adequate flow of foreign exchange which has contributed to the strengthening of Botswana’s economy;
- Botswana is positively ranked as the least corrupt country in Africa and ranks as the 28th least corrupt country in the world, according to the 2015 Corruption Perceptions Index by Transparency International, a global measure of corruption amongst public officials and politicians;
- Botswana was positively ranked as the 30th freest economy in the Heritage Foundation’s 2016 Index of Economic Freedom, a measure of freedom enjoyed in business, trade, monetary, financial, investment and labour markets. Outstanding trade and fiscal freedom were listed as the main reasons behind the high rank;
- It is easy to open global corporate bank accounts to support business setup in Botswana. Healy Consultants works with internationally recognized banks to provide Botswana corporate bank account services.
- Botswana has been ranked positively in the 63rd position (out of 137 countries) in the Global Competitiveness Index 2017-2018 edition. The country’s excellent macroeconomic environment along with an efficient labour market largely enhances the nation’s competitiveness and its global presence.
Disadvantages of Botswana company registration
- Botswana company incorporation is complex and time consuming. According to the World Bank it takes 48 days on average to set up a business here, compared to an average of 27 days in Sub Saharan African countries and 9 in OECD countries;
- A Botswana LLC is liable for a corporate tax rate of 22%, and may be liable for VAT at the rate of 10% as well;
- Many business sectors in Botswana remain closed to foreign investment and in most cases, land cannot be sold to foreign investors;
- The relative slow internet bandwidth and power situation present additional challenges to doing business in Botswana;
- Botswana ranks as 72 out of 189 economies in ease of doing business according to the World Bank with the main business obstacles being trading across borders, dealing with construction permits and getting electricity;
- Botswana has a small population of 2.3 million people and an adult literacy rate of 90%. Therefore, it is a challenging task for companies to acquire an adequate supply of low-skilled labour in Botswana.
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Best uses for a Botswana company
Botswana is an ideal location to set up a manufacturing company as the government offers incentives such as i) low tax rates of 15% on taxable income ii) tax holidays for up to 10 years iii) free repatriation of profits and dividends and iv) double tax treaties with 12 countries that minimize withholding tax and allow investors to avoid double taxation. -
Useful links for Botswana
Government and public authority websites:
- Botswana Tax Authority
- Central Bank of Botswana
- Botswana Stock Exchange
- Botswana Chamber of Commerce
- Botswana airports
External articles:
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