Honduras company registration

DOING BUSINESS IN HONDURAS IN 2019

Since 2003, Healy Consultants Group PLC has assisted our Clients with business registration in Honduras. Our services include i) Honduras company incorporation ii) government license registration iii) business bank account opening iv) employee recruitment i) visa strategies and vi) office rental solutions.

Summary table of Honduras company registration

SummaryTax Resident LLCCorporationFree zone LLCTourism companyBranch office
Also known asSdeRLSAZOLI companyTourism companyBranch
Best use of company?All products and servicesAll products and servicesManufacturing and export tradingTourism servicesSpecific projects
How soon can you invoice Clients\sign sales contracts?4 weeks4 weeks4 weeks4 weeks2 weeks
How soon can you hire staff?4 weeks4 weeks4 weeks4 weeks2 weeks
How soon can you sign a lease agreement?1 week1 week1 week1 week1 week
How long to supply corporate bank account numbers?6 weeks6 weeks6 weeks6 weeks6 weeks
How long to supply company registration \ tax numbers?4 weeks4 weeks4 weeks4 weeks2 weeks
Corporate tax rate on annual net profits?25%25%0%0%25%
Limited liability entity?YesYesYesYesNo
Government grants available?YesYesYesYesYes
Government approval required for foreign owners?NoNoNoNoNo
Resident director/partner/manager/ legal representative required?NoNoNoNoYes
Minimum paid up share capital?US$200US$1,025US$2,500US$200None
Can bid for Government contracts?YesYesYesYesYes
Corporate bank account location?Banco AtlántidaBanco de OccidenteBanco del PaísBanco Hondureño del CaféCitibank de Honduras
Can secure trade finance?YesYesYesYesYes
VAT payable on sales to local customers?15%15%15%15%15%
Average total business set up engagement costs?US$17,400US$19,400US$21,400US$21,400US$20,550
Average total engagement period?2 months2 months2 months2 months2 months

Honduras company registration summary

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  • Advantages and disadvantages

    Advantages of Honduras company registration

    Facts of doing business in Honduras

    1. A Honduras limited liability company (SdeRL) can be incorporated with 1 director and 2 shareholders, who can be of any nationality and can either be individuals or corporate bodies. The minimum share capital required is only US$250 and our Clients do not need to travel to complete the engagement;
    2. Foreign entrepreneurs will find business in Honduras smooth because they can i) incorporate and 100% own companies in any part of the country without restrictions ii) own property iii) export goods and services without restrictions;
    3. Honduras is a signatory to the US-Central America Free Trade Agreement (CAFTA) encouraging trade between the member countries and increasing good ties with the US, Honduras largest trading partner;
    4. Companies established in the Free Trade Zones in Honduras are exempt from all income taxes for a period of up to 20 years and 10 years for municipal taxes;
    5. With 50% of the population falling under the age of 19, Republic of Honduras promises a very youthful and robust work force;
    6. Honduras is a mineral-rich nation known for its vast mining sector. The nation has major reserves in lead, zinc, gold, copper etc among others. From January to July 2018, the economy exported i) zinc worth US$37.4 million; ii) lead worth US$11.7 million; and iii) gold worth US$59.7 million. Moreover, Honduras developed strong trade relations with reputable jurisdictions such as Belgium, South Korea and Australia.

    Disadvantages of Honduras company registration

    1. Our Clients will find it difficult to incorporate a branch of a foreign company in Honduras because the commercial code requires at least 1 Honduras permanent resident to legally represent the company and a minimum share capital of US$1,300;
    2. A Honduras LLC is subject to i) a corporate tax rate of 25% ii) a 5% surtax on annual taxable income above US$46,000 iii) a sales tax of 18% on sale of goods and services in the country;
    3. Due to declines in economic freedoms including freedom from corruption and investment freedom, Honduras currently ranks as the 116th freest economy out of 189 economies and 19 out of 29 jurisdiction in the South American and Caribbean region;
    4. Gang related violence, drug trafficking and political polarization are grave concerns limiting Honduras’ economic potential and political and social stability;
    5. Foreign investors will find it difficult to enforce contracts due to rampant corruption and the inefficiency in the judicial system. Enforcing a legal contract may take up to or more than 2 and a half years;
    6. English speaking entrepreneurs will find it difficult and expensive doing business in Honduras to the low proficiency in English. Additionally, Honduras Commercial Code requires that all business documents be translated into Spanish, the country’s official language;
    7. Honduras has a small population of approximately 9 million people with 50.27% of its economy engaged in the services sector. As a result, it might prove to be difficult for entrepreneurs to hire labour in other sectors such as agriculture or manufacturing.
  • Best uses for a Honduran company

    1. Entrepreneurs in the textile industry will find Honduras a great jurisdiction to do business in the Americas as it ranks as the 3rd largest exporter of textile products and apparel to the United States, only after China and Mexico.

Company registration

  • Time to incorporate: Three weeks
  • Cost to set up: US$17,400
  • Minimum capital: US$200
  • Physical office required: No

Required appointments

  • Shareholders: 2
  • Directors: 1
  • Company secretary: No
  • Resident director: No

Key facts

  • Corporate tax rate: 25%
  • Corporate tax base: Worldwide
  • Shelf companies: No
  • Main company type: S. de R.L.

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Contact us

For additional information on our company registration services in Honduras, please contact our in-house country expert, Ms. Chrissi Zamora, directly:
client relationship officer - Chrissi
Central Bank of Honduras honduras-gov honduras-mof Chamber of Commerce and Industry of Tegucigalpa