Registering a Business in South Africa. What foreigners need to know.
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- Опубліковано 12 сер 2021
- If you would like any assistance with registering you company in South Africa, please use the following link:
www.swiftreg.co.za/Swiftreg/p...
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alternative please browser our website on www.swiftreg.co.za/index.aspx for more services.
And now for the video script... :)
The short answer is Yes! Absolutely, in fact it is quite easy as a foreigner to register a company in South Africa. All you need is a valid passport; you don’t even have to be in the country as it can all be done online, plus you can be the sole director and the 100% shareholder.
Having said that, one of the criteria is that you need a physical South African business address for the company. If you are having problems with this, you can always open a virtual office using companies such as Regus, Cube Workspace or Craft + Graft. They will set you up with your own virtual office allowing you to use their business address for your company. They do however charge monthly fees, so shop around for the best deal.
The company registration is the easy part and should take at most 3 days to be registered, but as you guessed… there is a catch. At this stage you won’t be able to open a bank account or work for your own company. The reason for this is that you will need a business visa from the Department of Home Affairs. This is not so easy to get and takes time as there are many documents to complete. So before registering your company, I would recommend that you simultaneously apply for your business permit as without this permit your company will not be able to operate.
At Home Affairs there are numerous types of visa which foreigners can apply for; namely work visa’s, business visa’s, spousal visa’s, critical skills visa’s, study visa’s and many more. The appropriate visa will depend on your individual circumstances. It is also important to note that each visa can also have specific conditions and restrictions which may impede your ability to work or open a bank account. For example, with a work visa you can only open a personal bank account but not a business banking account.
In this video I will focus on the business visa (also known as the business permit) as this is the only visa which the South African banks will accept to open a business bank accounts for Foreigners in the name as their new South African company. Just to be clear the business visa’s are for foreigners who want to either start their own South African business or invest in an existing South African business.
One of the requirements for the business visa is proof that you have sufficient cash. The intention being that you will not be a burden on the South Africa Government. In most cases this amount is set at R5m but this amount may vary depending on the industry you are operating in; for example the IT, clothing and tourism industries have reduced investment requirement and the amount may even be waived altogether. The actual amounts required are determined by the Minister of Trade and Industry which are published in the Government Gazette. The Department of Home Affairs has outsourced the business visa application process to a private company, called VFS Global.
If you are investing in an existing business, you will also need a temporary residence visa and keep renewing it until your permanent residence is approved.
The South African government would like you to give them an undertaking that 60% of our future staff must be South African and that you will register them with SARS for PAYE and with the department of Labour for COID.
There is a second scenario, and this is if you already have an existing business in your home country and you would like to open a branch or a subsidiary in South Africa you have two options.
Let’s use the example of a company like Tesla. If Elon Musk decides to open a Giga factory in South Africa, he will have two options. Firstly, Tesla can register an External company which is effectively a registered “branch” in South Africa. The directors and shareholders can remain in the country of origin and they appoint a South African resident responsible for the operations and compliance. External companies pay normal company tax currently 27% but no dividend withholding tax.
The next option for a foreigners wanting to open a branch in South Africa is to register a standard private company with the shares held by the overseas company. This is called a subsidiary and in this scenario the company will pay the standard company tax plus dividend withholding tax.
Finally, I would like to clarify that the Business visa from home Affairs must not be confused with the Business permit from the local municipality. The municipal permit is to comply with health and safety if you are selling food directly to the public. - Навчання та стиль
Thank you so much for this information… I’m glad I found this today.
Glad it was helpful!
Thanks a lot. Very helpful
You are welcome!
Your sweet thanks kindly for sharing.
You are so welcome
thank you so much for this information, it is very helpful. I am looking for information on registering an export company (specialising in perolium machinery) and partnering with a foreigner. I have no idea where to start as information seems to be all over the place.
Hi Thembekile, I am assuming you are South African. My suggestion would be that you become the sole director of the company as this would make it simpler to open bank accounts etc. You can divide the shareholding between yourself and your partner according to your shareholders agreement. I would start by registering a Pty. To help you understand more about the process, I have made a video on this topic. I hope it helps. Good luck. ua-cam.com/video/z7p-wMpyjW8/v-deo.html
Sooo useful
Glad it was helpful!
Thank you great information I am a American I want to start a aviation, charter, cargo company in South Africa as well as other companies I need all the help I can get!!!!
I am glad it was helpful, good luck with your business venture.
@@swiftreg Great content.
Thanks, look I was wondering if I can register on someone else's behalf, like make a business out of it, have my smalanyana mark up, do you have any idea how I can do that without getting into trouble, are the laws that I need to know of, or some procedures to follow?
Your response will be highly appreciated.
Tnx❤️
A Question - does the company in my home country have to be trading in the said country to be allowed to register as an external or subsidiary branch in South Africa ?
Hi Sacgire, this is a brilliant question. I don't think so, as CIPC does not ask for financials during the application process.
If starting a new business in South Africa, I wouldn't have the R5m upfront. How would that work? And you mentioned the amount can be waived altogether, how likely is that?
Hi Boomerang, this is a question you would need to put to Home Affairs, however dealing with them can be frustrating. I would therefore consider contacting a few consulting companies that offer assistance with business visa applications as they deal with these application on a daily basis.
Hi! Im not sure you could answer this but, would a Airbnb business qualify for the business visa ? Being that I form an LLC with it?
Hi there, I don't see why not, sorry I can't be more definitive than that. You would need to discuss this with the immigration specialist.
Great content 👌🏻 Planning to buy a farm currently owned by a business do i need to register a company/ i can buy the farm in my own name.
What other visa can i apply for if i want to relocate to South Africa with my family ?
Hi there, you can buy the farm in your name or in a company. I have made a video of the benefits of registering a company. This may help you with your decision.
ua-cam.com/video/_CAYSrmUSjk/v-deo.htmlsi=dnjGIT54V_VV6AT5
I am afraid I can't advise on the visas as this is a service we do not offer.
Hi, great video this helps a lot.
I'm planning to register an online business in South Africa with a partner, do I still need a business permit in order for the online business to operate? both of us will be the owners of the business
Hi Alpha, Is your partner a South African? If so, the opening of the business bank account will be much easier. If not, you would both need to apply for the business permit from Home Affairs as per the video.
@@swiftreg yes my partner is a South African. So whether it’s an online business or a bric & mortar the registration is still the same right?
Hi Alpha, Yes the company registration remains the same. I would suggest that only your partner is initially appointed as the director of the company. You can both be equal shareholders from the start, but this will allow the banks to open the business bank account. Once you have your work permit you can become a director if you so choose.
@@swiftreg Thank you very much this helps a lot. I owe you a nice cold savanna when I come down to SA :)
❤
Thank you :)
Hi. I'm currrently a university student studying here in south Africa on a study visa. me and my south African friend decided to start our e-commerce company and are planning to register the company. Do I still need business visa to 1. work in the company 2. create our business bank account ?
Hi Tafadzwa I am afraid, but according to the law you would still need a business visa.
How is it for a someone who already lives in the country on a student visa and they want to start a company headquartered in RSA even if the market is another country!? Thank you
Hi there, the same principles will apply. Generally speaking most countries tax income at source, so this would mean you should register another company in the country in which your market is (i.e where you generate your income). I hope this answers your question.
Hi. Thanks for the video.
If I am a South African Citizen, but I'm not a tax resident (I've ceased my tax residency)
I have a company in another country which I own 100%.
I want to open a branch or "external company" in South Africa that will own property and offer short term stays. I will appoint a South African resident to be managing director that will run the business, represent the branch and manage sars compliance.
With me owning the foriegn company earning dividends from the branch, will that trigger SARS to tax me as an individual since that is from a South African source?
Or is my income not taxable if the branch pays my dividends to foreign headquarters which will pay me? Is that still South African source income?
Hi Bantumart, thank you for your enquiry. Your last sentence is correct. The company will pay tax (27% on profits) as well as dividends tax (20%) so there are no additional taxes in your personal capacity as you are not drawing a salary. I hope this answers your question.
Does a Zimbabwean require a business visa, since I do not need any visa to enter south africa
Hi there, the rules are changing all the time. I would recommend you contact an immigration specialist.
Hi Douglas. I left a contact us on your website a couple of weeks ago but had no reply or feedback yet. How can I email you directly?
Hi NH Netwrox you can contact us on info@swiftreg.co.za
If you are a foreigner and intend to start a business with a South African business partner, do you still need to present the R5million? Say we are going 50/50 on a Fintech business idea
Hi Fernando, that is an excellent question. However, regardless of the percentage ownership in the business you still require the R5m investment to obtain the business visa.
@@swiftreg Thanks for your reply. Still find it unfair to put a fixed price to it. Because our business fall into critical skills arena and we are building something out of our brains as we are both say software engineers and decided to build something to impact the whole african continent and chose South Africa as a hub. The business can start and run with far less than R5million. Can't I be one of the directors with a critical skills visa? Use it to get a temporary residence and become an employee of the same firm and also a shareholder? How ilegal that would be? :)
That's great.I HV a visitor visa Nd I HV fnb business account as well now I started working Nd I HV business now.can I rigesterd my business.
Hi Ali, yes you can register your company now, I would recommend you click on our website www.swiftreg.co.za and select one of the packages to get the best value.
i'm foreign, if i want create a e-commerce, i need follow same thing?
Hi Bill, not necessarily, this is because international ecommerce sites pay corporate tax in the country where the company is registered Eg Mauritius (15%) Ireland (12.5%) and South Africa (27%) The amount of tax will be based on the amount of money is collected by the company.
You will also need to pay sales tax in the country where the sale took place Eg South Africa (VAT =15%) A great example of this is Google is headquartered in Ireland but pays VAT on all revenue generated here in South Africa. I hope this answers your question.
@@swiftreg Where i can create a company in South Africa as foreign? What documents is required? I only have a passport
Did you manage i have same problem I’m done some documents but i afraid something is gona be wrong
Hi Bill, can use the following link, just remember you need a South African address, but you can use your passport as a foreigner.
www.swiftreg.co.za/Swiftreg/products/Company_registration.aspx
I have multiple visa
Congratulations, what type of visa?
which of the foreigner you are referring to
Hi Thelmar, for the purpose of registering a South African company with CIPC a foreigner is considered anyone who does not have a South African Identification number.
@@swiftreg Hi there, If a foreigner has a south african ID, do they still need to apply for a business visa?
@@nicolefaro9609 Hi Nicole, No not that I am aware of.
Good day, im a foreigner and so me and a friend of mine wanna register a coffee company together but the thing is i dont have a South African ID and don't have that money tbaat qualifies you to open a business as we are starting up is there a way we can still go about registering the company