Business entity types & details

• Sole Proprietorship
  Unlike corporate business entities, a sole proprietorship describes a business owned by an individual. As the name suggests, the owner (sole proprietor) has complete control of the company. A sole proprietorship is a small business entity with the owner as the sole employee. Most sole proprietorships have a low budget, so sole proprietorship owners are also the central employees. In rare cases, sole proprietors get help from family members. To register a sole proprietorship in Tanzania, follow the following steps:

1. Avail necessary documents: The following are the documents needed to be registered officially as a sole proprietor:

• • An identity card, such as a passport or national identity card, can confirm your identity.
  • A title deed proves land ownership if the business is on your property.
  • Rent receipts that arrange proof of lease if you rent space for your business.
  • Tax receipts that show your credit worth.
  • VAT registration certificate.
  • Passport photos for social security registration.
  • Residence permit for foreign sole proprietors. 

2. Business name registration: To get a sole proprietorship business name, a sole proprietor must submit the above documents for assessment to the Business Registration and Licensing Agency. A business application form and a fee of TSZ 50,000 accompany this.

3. Obtaining a Tax Identification Number from Tanzania Revenue Authority. 
4. After assessing your documents at the Kinondoni Municipal Council, you can acquire a business license. A fee of TSZ 1,000 is required to get a license registration form.

• Partnerships

Partnerships are business entities ventured into by two or more individuals that pool their resources. For partnerships to be legal under the Tanzanian government,  they must submit a register of its members to company registrars. Afterward, the company should register with the Tanzania Revenue Authority and National Social Security Fund for operation.

• Limited Liability Companies

Limited liability companies are an incorporation of subsidiaries that allow shareholders to own assets and keep their profit after taxation. There are two types of Limited Liability Companies:

• Private Limited Liability Companies: This is a legal business entity with few shareholders as the owners.
• Public Limited Liability Companies are prominent, independent legal entities with many shareholders as owners.

• Corporations

Corporations in Tanzania operate under companies. Corporation business entities are companies that act legally with the approval of the national government. They are created by several shareholders that pool resources together. They profit from their corporate business entity and share it among themselves. 

Cost Of Business Registration

1. Sole Proprietorship: Tzs 50,000
2. Partnerships: Tzs 100,000 - 450,000
3. Corporations: Tzs 100,000 - 450,000
4. Public Limited Liability Companies: Tzs 100,000 - 450,000
5. Private Limited Liability Companies: Tzs 100,000 - 450,000

Business Registration Requirements In Nigeria

1. Registered address and contacts of the proposed company.
2. Identification Documents (I.D/ Passport)
3. Approval note of name reservation from the Corporate Affairs Commission
4. Details and information of Director(s) and shareholder(s)
5. Company secretary details for foreign companies
6. Constitutive documents, e.g., Article of association and memorandum of association
7. Incorporation certificate

Steps

1. Select your business structure

In Nigeria, typical business structures include corporations, sole proprietorships, limited liability companies, and partnerships. Each structure offers varying degrees of operational flexibility, tax implications, and liability protection, so take these factors into account.

2. Secure your business name.

Reach out to the Corporate Affairs Commission (CAC)  to check the availability of your preferred business name. Once approved, reserve it to establish your brand identity.

3. Organize documentation

Gather all necessary registration documents to establish your business. This usually includes constitutive documents, such as a memorandum of association indicating that certain individuals (shareholders) have agreed to create a company. The article of association outlines the regulations that will oversee your company. You also need to provide identity documents and a physical address.

4. Pay registration fees

Submit all required documents to the Corporate Affairs Commission (CAC). Pay the stamp duty, filing fee, and other registration costs to receive approval certificates.

5. Adhere to tax regulations.

Nigeria's tax authority is the Federal Inland Revenue Service (FIRS). Your business must be approved by FIRS to begin taxable operations in the country. Upon approval, you will receive a Tax Identification Number (TIN). Additionally, if your company’s annual revenue exceeds a specified limit, you need to apply for Value Added Tax (VAT).

6. Acquire necessary permits from regulators.

Various government agencies in Nigeria enforce policies through licenses and permits. The specific licenses required depend on your industry, business activities, and employee profiles.

7. Open a business bank account

Remember, all businesses aim to generate profits. Open an official business bank account to manage your finances effectively. Additionally, banks often serve as reliable credit sources when you need loans.

Business Registration Requirements

1. Immigration documents
2. Name reservation certificate
3. Article and memorandum of association
4. Shareholders’ identification documents
5. Physical address
6. Minimum capital requirements
7. Tax Identification Number
8. Licenses
9. Local representatives
10. Professional advice

Steps

• Step 1: Acquire a residency certificate or business visa.
• Step 2: Contact the Business Registration and Licensing Agency to look for and reserve a business name.
• Step 3: Designate a Tanzanian national as your local representative or director.
• Step 4: Create and submit your company's:
  Memorandum and Articles of Association
  Declaration of Compliance
  Identification documents for all directors.
  Physical address
• Step 5: Submit the notarized documents to BRELA either physically or online. 
• Step 6: Enroll your business with Tanzania Revenue Authorities to receive a Tax Identification Number and VAT approval. 
• Step 7: Acquire all necessary permits and licenses from the appropriate agencies. 
• Step 8: Form No. 434 must be submitted for internal companies.
• Step 9: Send in a declaration of integrity form. 
• Step 10: Open a Tanzanian bank account for your business. 

Annual filing documents & requirements

1. All registered companies must submit yearly returns to the BRELA by 18 months following the date of establishment.
2. Additionally, businesses must submit annual tax returns to the Tanzania Revenue Authority.
3. Branch firms must submit statements of audited accounts.
4. Business owners must notify the BRELA of any changes, including appointments or capital increases in shares. Businesses must also submit charges with the BRELA when mortgaging firm assets.
5. The business owners must also file returns on non-citizen employment with the Labour Commissioner. 

Frequently Asked Questions

Can Foreigners Start A Company in Tanzania?

Certainly! Tanzania's business-friendly environment, rich resources, and supportive government policies have attracted global investors, aiding its transition to a lower-middle-income economy.

Which are The Top Startup Business Opportunities in Tanzania? 

Tanzania’s Agribusiness industry is unmatched! The country's agriculture sector has enhanced other prevalent interconnected industries, such as infrastructure and IT. 

How long does it take to register a business in Tanzania? 

Registering a company in Tanzania takes a week to three weeks. During this period, the business documents are gone through before approval. The bigger the business, the more time it will take.

What are The Legal Requirements Needed to Register a Business in Tanzania?

Below is a list of the documents you need to register a business in Tanzania:
Identity card.
Title deed.
Rent receipts
Tax receipts.
VAT registration certificate.
Passport photos
Residence permit.