DOING BUSINESS IN ZIMBABWE IN 2023
Since 2003, Healy Consultants Group PLC has assisted our Clients with business registration in Zimbabwe. Our services include i) Zimbabwe 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 Zimbabwe company registration
| Summary | Tax resident LLC | Fast business setup solution | Representative office | Trust |
|---|---|---|---|---|
| Also known as | (Pvt) Ltd | Fast business setup solution | RO | Trust |
| Best use of company? | All products and services | Close a customer deal now | Marketing & research | Tax planning |
| How soon can you invoice Clients/sign sales contracts? | 2 months | 2 weeks | 2 months | Cannot |
| How soon can you hire staff? | 2 months | 2 weeks | 2 months | Cannot |
| How soon can you sign a lease agreement? | 2 months | 2 weeks | 2 months | 1 month |
| How long to supply corporate bank account numbers? | 3 months | 3 weeks | 4 months | 2 months |
| How long to supply company/entity registration/tax numbers? | 2 months | 2 weeks | 2 months | 1 month |
| Corporate tax rate on annual net profits? | 25% | 25% | 0% | 0% |
| Limited liability entity? | Yes | Yes | Yes | Yes |
| Resident director/partner/manager/legal representative required? | No | No | Yes | No |
| Minimum /recommended paid up share capital? | US$1 | US$1 | US$1 | None |
| Can bid for Government contracts? | Yes | Yes | Yes | No |
| Corporate bank account location? | Standard Chartered | Stanbic Bank | First Capital Bank | Ecobank |
| VAT payable on sales to local customers? | 15% | 15% | Cannot trade | Cannot trade |
| Average total business set up engagement costs? | US$17,700 | US$27,960 | US$16,500 | US$19,600 |
| Average total engagement period? | 3 months | 3 months | 4 months | 3 months |
| Accounting and tax considerations | Tax resident LLC | Fast business setup solution | Representative office | Trust |
|---|---|---|---|---|
| Statutory corporate tax payable? | 25% | 25% | 0% | 0% |
| Legally tax exempt if properly structured? | No | No | Yes | Yes |
| Must file an annual tax return? | Yes | Yes | No | No |
| Must file annual financial statements? | Yes | Yes | Yes | No |
| Monthly VAT reporting to the Government? | Yes | Yes | No | None |
| Must appoint an auditor? | No | No | No | Yes |
| Access to double taxation treaties? | Yes | Yes | Yes | None |
| Withholding tax on payments to foreign shareholders? | 15% | 15% | Cannot trade | None |
| Company Registration | Tax resident LLC | Fast business setup solution | Representative office | Trust |
| Resident director/partner/manager/legal representative required? | No | No | Yes | No |
| Minimum number of shareholders/partners? | 1 | 1 | 1 | No |
| Maximum shareholding for foreigners? | 100% | 100% | 100% | 100% |
| Minimum number of directors/managers? | 1 | 1 | 1 | 1 |
| Minimum / recommended statutory paid up share capital? | US$1 | US$1 | US$1 | US$1 |
| Shelf companies available? | Yes | Yes | No | No |
| Time to incorporate a new entity? | 7 weeks | 3 weeks | 8 weeks | 6 weeks |
| Must sign an office lease agreement during incorporation? | No | No | Yes | No |
| Can easily convert to a PLC? | Yes | Yes | No | No |
| Public register of shareholders and directors? | Yes | Yes | Yes | Yes |
| Can have preference shareholders/partners? | Yes | Yes | No | No |
| Business Considerations | Tax resident LLC | Fast business setup solution | Representative office | Trust |
| Can secure residence visa for business owner? | Yes | Yes | Yes | Yes |
| Good entity for trademark registration? | Yes | Yes | No | No |
| Can secure an import and export license? | Yes | Yes | No | No |
| Sponsorship by a local citizen required? | No |
| Our Client needs to travel to Zimbabwe for business set up? | No |
| Temporary physical office solutions available? | Yes |
| You need a local resident as bank signatory? | No |
| Can be wholly foreign owned? | Yes |
| The entity will likely be regulated by? | DCIP |
| Shareholders & directors documents to be attested\translated? | Yes |
| Each foreign director needs a personal income tax number? | Yes |
| Foreign non resident director needs a residence visa? | No |
| Maximum number of staff allowed? | No maximum number for any entity |
| Expatriate to local staff ratio? | None |
| Other useful information | |
| What will be included in my customer sales invoice? | Click link |
| This country has signed free trade agreements? | Yes |
| This country is a member of WIPO/TRIPS? | Yes |
| This country is a member of the ICSID? | Yes |
| Average custom duties suffered? | 5.43% |
| Government foreign investment approval required? | Yes |
| Average monthly office rental? (US$ per sq m) | US$9 |
| Minimum statutory monthly salary? | US$100 |
| Average monthly US$ salary for local skilled employees? | US$350 |
| US$ deposit interest rate? (1 year average) | 121.5% |
| Overseas remittance currency controls? | None |
| Banking considerations | |
| Multi-currency bank accounts available? | Yes |
| Corporate visa debit cards available? | Yes |
| Quality of e-banking platform? | Average |
| Crowd funding available in this country? | Yes |
| Group HQ tax incentives? | No |
| Security deposit to be kept with Government? | No |
| Can secure trade finance? | Yes |
| Government grants available? | Yes |
| Government approval required for foreign owners? | No |
Zimbabwe business setup summary
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Advantages and disadvantages
Advantages of Zimbabwe company registration
- Zimbabwe is one of the world’s poorest countries, suffering from monetary and political instability and high corruption. However, uncharacteristically high growth rates over the past few years have made Zimbabwe a more popular option for high-risk investors. Due to heavy government restrictions on foreign investment in most industries, a properly structured Zimbabwe company is a necessity for Zimbabwe to be a viable investment choice for entrepreneurs;
- Zimbabwe has been a member of the World Trade Organization since 1995 and thus, enjoys all of the benefits that membership provides;
- Zimbabwe is gifted with plentiful resources in both the mining and agricultural industries, with diamond and gold deposits being particularly large;
- Zimbabwe has seen growth rates from 4.2% to 4.5% in the past two years. While this is significantly higher than rates over the past decade, the economy seems set to continue showing similar growth rates, at least in the short term;
- A Zimbabwe Limited Liability Company (LLC) requires only 1 shareholder and 1 director;
- Zimbabwe company formation is inexpensive and does not have a minimum share value;
- It is easy to open global corporate bank accounts to support Zimbabwe business registration. Healy Consultants works with internationally recognized banks to provide corporate bank account services;
- Zimbabwe is developing new Export Processing Zones (EPZs). Benefits for companies incorporated in these zones will include i) a five-year tax holiday, ii) duty-free importation of raw materials and capital equipment for use in the EPZ, and iii) no tax liability from capital gains arising from the sale of property forming part of the investment in EPZs;
- English is one of the official language of Zimbabwe and is spoken by 41% of the population, mostly from business and administration environment. Therefore, foreign investors will be able to communicate with employees, customers and suppliers with not much trouble.
Disadvantages of Zimbabwe company registration
- The government of Zimbabwe has implemented restrictions on foreign ownership of Zimbabwe companies. Although some industries still allow 100% foreign-ownership, several lucrative industries, such as the mining industry, restrict foreigners to a minority-ownership;
- The economy of Zimbabwe is relatively fragile. In 2009, Zimbabwe was forced to abandon its own currency due to constant hyperinflation;
- Zimbabwe company setup is complex and time consuming, requiring an average of 90 days to complete;
- Zimbabwe is negatively ranked 160th in terms of corruption, according to the 2018 Transparency International Index, a global measure of corruption amongst public officials and politicians;
- A Zimbabwe LLC is liable for a corporate tax rate of 25%, and may be liable for a VAT rate of 15% as well;
- Zimbabwe was negatively ranked as the 175th freest economy over 178 economies in the Heritage Foundation’s 2019 Index of Economic Freedom, a measure of freedom enjoyed in business, trade, monetary, financial investment and labor markets. A complete lack of monetary stability and having one of the world’s worst financial sectors were listed as the main reasons behind the poor rank;
- Zimbabwe is negatively ranked as the 127th most competitive economy over 150 economies in the world in the World Competitiveness Report 2019;
- Zimbabwe is negatively ranked as the 140th easiest country to do business in, over 189 countries according to the 2020 Doing Business Survey. The World Bank lists dealing with construction permits and resolving insolvency as the main barriers to business.
Best uses for a Zimbabwean company
- Zimbabwe is a great place to form a company in the agricultural and mining industries.
