DOING BUSINESS IN NAMIBIA IN 2020
Since 2003, Healy Consultants Group PLC has assisted our Clients with business registration in Namibia. Our services include i) Namibia company incorporation ii) government license registration iii) business bank account opening iv) employee recruitment v) visa strategies and vi) office rental solutions.
Summary table of Namibia company registration
|Summary||Tax resident LLC||Turnkey solution||Free zone LLC||Branch office||Business trust|
|Also known as||Private company||Shelf company||Export processing zone company||Branch||Trust|
|Best use of company?||All products and services||Close a customer deal now||Manufacturing and export trading||Specific projects||Asset management|
|How soon can you invoice Clients/sign sales contracts?||2 months||3 weeks||2 months||10 weeks||2 months|
|How soon can you hire staff?||2 months||3 weeks||2 months||10 weeks||2 months|
|How soon can you sign a lease agreement?||3 weeks||3 weeks||3 weeks||4 weeks||3 weeks|
|How long to supply corporate bank account numbers?||3 months||3 weeks||3 months||14 weeks||3 months|
|How long to supply company registration / tax numbers?||2 months||3 weeks||2 months||10 weeks||2 months|
|Corporate tax rate on annual net profits?||32%||32%||0% - 18%||32%||0%|
|Limited liability entity?||Yes||Yes||Yes||No||N/A|
|Government grants available?||Yes||Yes||Yes||Yes||No|
|Government approval required for foreign owners?||No||No||No||No||No|
|Resident director/partner/manager/ legal representative required?||No||No||No||No||No|
|Minimum paid up share capital?||US$1||US$1||US$50,000||US$1||US$1|
|Can bid for Government contracts?||Yes||Yes||Yes||Yes||No|
|Corporate bank account location?||Bank Windhoek||First National Bank||Nedbank||Atlantico||Trustco|
|Can secure trade finance?||Yes||Yes||Yes||Yes||No|
|VAT payable on sales to local customers?||15%||15%||0%||15%||15%|
|Average total business set up engagement costs?||US$11,900||US$23,850||US$11,750||US$13,100||US$12,950|
|Average total engagement period?||3 months||2 months||3 months||4 months||3 months|
Namibia business setup summary
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Advantages and disadvantages
Advantages of Namibia company registration
- A company in Namibia can be incorporated with 1 director and 1 shareholder, neither of whom are required to be Namibian nationals or residents. Also, there will be no initial share capital requirements and the Client will not be required to travel to the country to complete the engagement;
- Certain businesses are eligible for government incentives in Namibia including:
- Our Clients incorporating for the purposes of manufacturing and re-export trade will enjoy following tax incentives: i) additional 25% wage allowance ii) additional 25% allowance on marketing expenses for exporting goods iii) 80% exemption on gross annual income and iv) an additional allowance of 20% (in the first year) and 8% (subsequent ten years) on erection costs of buildings used for trade purposes;
- EPZ companies will enjoy the following benefits: i) 100% exemption from corporate income tax, VAT and import duties ii) eligibility for government grants for employee training iii) free repatriation of funds from the zone iv) eligibility for holding foreign currency accounts in Namibian banks and v) streamlined processes for setup in the zones;
- Businesses may also derive benefits from Namibia’s multi-lateral trade agreements including:
- Namibia is party to the South African Development Community (SADC), comprising of 12 members. Under this agreement, our Namibian Clients may be granted preferential treatment within the member states and enjoy access to more than 130 million people;
- Namibia is also member of the South African Customs Union (SACU). Countries party to this agreement allow local companies i) transnational duty free trade and ii) access to a mark of 47 million people. Furthermore, SACU countries have also signed trade agreements with the SADC, Mercosur bloc, the European Union and the United States.
- Namibia is an excellent destination for fisheries, aquaculture and related activities due to the reasons below:
- The country has a 1500 km long coastline and is renowned to be one of the world’s richest fishing grounds;
- The estimated national fishery reserves of Namibia is the largest in South Africa with an output of 1.3 million tons;
- Namibia enjoys the reputation of being the top African country for production of fisheries both by value and exports;
- Mari-culture is a growing avenue in the fisheries sector in Namibia. It has shown a positive outlook with its 3 successful oyster farms and 1 seaweed harvesting enterprise.
Disadvantages of Namibia company registration
- Namibia company formation is complex and time consuming, requiring an average of 66 days to complete;
- A Namibia LLC is liable for a corporate tax rate of 35%, and may be liable for a VAT rate of 15% as well;
- Namibia is negatively ranked as the 52nd least corrupt country in the world, according to the 2018 Corruption Perceptions Index by Transparency International, a global measure of corruption amongst public officials and politicians;
- Namibia was negatively ranked as the 99th freest economy in the Heritage Foundation’s 2019 Index of Economic Freedom, a measure of freedom enjoyed in business, trade, monetary, financial, investment and labour markets. An ineffective judicial system and a lack of financial infrastructure to encourage dynamic investment were listed as the main reasons behind the low rank;
- Namibia is negatively ranked as the 94th most competitive economy in the world in the Global Competitiveness Report 2019, down from 74th in 2010;
- Namibia also fares poorly in the World Bank’s annual Doing Business survey, which ranks the country as the 104th easiest country in the world for doing business;
- It can be difficult to open global corporate bank accounts to support a Namibian company. Healy Consultants works with internationally recognized banks to provide corporate bank account services;
- The Namibian economy is heavily dependent on mining and exploration activities with almost 47% of the country’s exports belonging to this sector. Consequently, a heavy reliance on mining leads to a deterioration of the environment of the country leading to contamination of soil, heavy air and noise pollution as well as serious damage to the health of the population in the country. Moreover, traders and manufacturers belonging to other sectors are not likely to invest in Namibia.
Best uses for a Namibian company
- Outsourcing centre for South Africa: South African businesses can send lower-cost work across the border to Namibia, which uses English as its first language but has a significantly lower average wage of approximately US$5,880/year.
- Time to incorporate: Four weeks
- Cost to set up: US$11,900
- Minimum capital: US$1
- Physical office required: No
- Shareholders: 1
- Directors: 1
- Company secretary: No
- Resident director: No
- Corporate tax rate: 33%
- Corporate tax base: Territorial
- Shelf companies: No
- Main company type: Limited company
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Useful links for Namibia
Government and public authority websites:
- Namibia Company Registrar
- Bank of Namibia
- Namibian Stock Exchange
- Namibia Chamber of Commerce
- Namibia airports
- Visiting Namibia