Tanzania is the second-largest economy in East Africa and is in a steady motion of growth as a result of increased trade and investment. Foreign direct investments are significantly influenced by the country’s political integrity. The overall quantity of trade flows, which accounts for 42% of Tanzania’s GDP, indicates the country’s reliance on international trade. The government has enacted a number of measures to encourage foreign investment, including modifications to the tax system and the establishment of an investment promotion committee.
Tanzania has several opportunities that encourage fresh investments and motivate new and aspiring businesses. Tanzania is a growing country with a plethora of investment opportunities ranging from agricultural, tourism, manufacturing, and importing. If you want to start a business in Tanzania, the most potential industries are IT, infrastructure, and agriculture. There is a big chance for American companies to examine software gadgets that may help local businesses develop. The government has made substantial investments in infrastructure projects like as motorways, airports, and trains.
Once you have decided on the type of business to be started in Tanzania, it is recommended that you consider the process of registering your business to maintain good legal standing in the Tanzanian market. Tetra Consultants’ team of business set-up consultants has years of experience assisting our international clients with the business registration process in Tanzania so that you can channel your energy into other important aspects of your business operation in the country. In this article, our team has outlined the steps to register company in Tanzania so that you can make a more informed decision and befriend the whole process of business registration in Tanzania.
Business Registration Process in Tanzania
Step 1: Choose the business structure
- The first step when registering a company in Tanzania as a foreigner is to understand and decide which business entity or vehicle you wish to choose to incorporate. Under Tanzanian Company law, they offer varying organizations or business entities that you can register as but here are the main business types:
Sole proprietorship:
- The simplest and most economical business structure is a sole proprietorship.
- Making decisions is simpler because there is just one owner.
- Instead of a corporation tax, tax is imposed towards the personal income rate.
Limited liability company:
- A limited liability corporation (LLC) is an autonomous legal body that does not depend on its shareholders for its operation.
- The amount of each shareholder’s liability to cover an LLC’s obligations and liabilities is limited to their share capital contribution.
- LLCs require a minimum of two shareholders and two directors, who may be citizens of any nation.
- The minimum paid-up share capital is not required.
- An LLC is the most common legal structure used by foreigners to register their businesses, and it is perfect for forming small enterprises with simple shareholder structures.
Public company:
- A public corporation in Tanzania represents a company whose shares are available for public trade.
- A minimum of two directors and seven shareholders are required for such an entity, one of whom must be a Tanzanian citizen and possess at least 40% of the company.
- A minimum share capital investment of US$300,000 is required to form a public company. The best choice for anyone looking to obtain capital or list their firm on Tanzania’s national stock exchange is to form a public corporation.
Branch:
- A foreign company may open a branch office in Tanzania that is entirely controlled by foreign investors. It may be utilized to carry out domestic business.
Step 2: Reservation of company name
- Tetra Consultants will search for the availability of the name of your company name through the Tanzanian trade register.
- Once the availability of your company’s trade name has been confirmed, Tetra Consultants will reserve your company’s trade name with the Business Registration and Licensing Agency (BRELA).
Step 3: Preparation and submission of relevant documents to register company in Tanzania
- Before Tetra Consultants can incorporate your company in Tanzania, you are required to provide a list of required KYC documents. Some of these documents include the names of directors, the company’s resolution, and identification proof.
- Based on the documents provided, Tetra Consultants will draft and notarize the Memorandum and Articles of Association, business plan, and other incorporation documents.
- After preparing the required documents, Tetra Consultants will proceed to register company in Tanzania through the Business Registration and Licensing Agency (BRELA) by submitting the documents prepared accompanied with Form-14A.
- Upon successful registration of the company, Tetra Consultants will courier the Tanzania company business registration certificate, Memorandum and Articles of Association, and other corporate documents to your preferred address.
Step 4: Corporate bank account opening
- Depending on your business structure, the documents required to open a corporate bank account will be slightly different. Tetra Consultants will help in consolidating the documents and opening a corporate bank account with a reputable bank of your choice.
- A Tanzanian company is not obliged to have a local bank account, a good alternative is to open a bank account for your business with a reputable international bank. You may leverage Tetra Consultants’ network and partnerships with many good offshore banks such as in Singapore or Switzerland.
- Once the bank account has been successfully opened, Tetra Consultants will courier the internet banking token and access codes to your preferred address.
Step 6: Registration with tax authorities and application for relevant business license
- Your new business also needs to be registered with the Tanzanian Revenue Authority (TRA) in order to obtain a tax identification number (TIN). Tetra Consultants will assist you in obtaining the tax identification number with respect to Income tax as well as VAT so that you can claim VAT deductions on the investments you make to start the business.
- Tetra Consultants will check whether there are licenses applicable to your company. For example, register with the social security authorities and with the pension fund for employment purposes.
- Tetra Consultants will apply for the relevant license based on the nature and scope of your business activity.
Conclusion:
- Engage Tetra Consultants as we guide you through a smooth and hassle-free business registration process in Tanzania. The team provides a comprehensive service package that includes planning and strategizing with our clients to select a suitable business entity, completing the registration and documentation processes, obtaining required licenses, opening a corporate bank account, and ensuring compliance with government regulations.
- Contact us to find out more about how to register a company in Tanzania and our dedicated and experienced team will revert within the next 24 hours.
