Tanzania

About the Country

The United Republic of Tanzania is a country in Eastern Africa within the African Great Lakes region sharing border with Kenya and Uganda to the north; Rwanda, Burundi, and the Democratic Republic of the Congo to the west; Zambia, Malawi, and Mozambique to the south; and by the Indian Ocean to the east. The below content will explain you in detail about the requirements for the company formation in Tanzania , know more about the process of trademark registration in Tanzania and understand the Tanzania Legal and Compliance requirements.

Tanzania

Doing Business Introduction

The Country's is a middle-power country, with a per capita GDP below the average and ranking 23rd among those countries. Since the recession ended, the Tanzanian economy has expanded rapidly thanks to strong tourism, telecommunications, and banking sectors. Also, economy is heavily based on agriculture, which accounts for 24.5% of gross domestic product

As per Doing business report of The World Bank -Tanzania ranks 132 for 2017 survey. YourGlobalPro professionals are able to assist with any type of company formation in Tanzania, trademark registration in Tanzania and other recurring services for your business in Tanzania.

Incorporation - Types of Business Entities

There are several types of entities that can be incorporated in Tanzania by the investors are as mentioned below:

  • Registered companies (private and public)
  • Branch offices of companies registered outside Tanzania
  • Partnerships
  • Sole proprietorships
  • Associations, Societies and Non-governmental organizations.

Time Frame for Incorporation of Company in Tanzania varies from depending on the type of entity selected. YourGlobalPro professionals estimate the time required for the process of Company formation in Tanzania to be completed is 25-30 working days.

Benefits of Registration of a Company

Below are the advantages of company formation in Tanzania:

  • Being amongst the developing countries, the market is full of opportunities for investments
  • Tanzanian government provides various investment incentives to local and foreign investors
  • Tanzania is very peaceful (Political stabile) and it also offers a very conducive environment for businesses
  • Plenty of uncultivated arable land for agricultural investment
  • Labour market in Tanzania is readily available with skilled and semi-skilled workers who are ready and available to work in various industries
  • Benefit of low importation costs since Tanzania is a hub for landlocked countries
  • Offering opportunities for businesses to grow and expand beyond its borders

Tax Registration and Filing

In Tanzania, Companies are considered resident for tax purposes if -incorporated or formed under the laws of Tanzania or Management and control of the affairs of the company are exercised in Tanzania at any time during the year of income. Below is some crucial point in relation to taxation rates in Tanzania

Corporate Income Tax Rate 30%
Capital Gains Tax Rate 30%
Branch Tax Rate 30%
Value-added tax (VAT) 18%
Tax on Dividend- (Listed Company) 5%
Tax on Dividend- (Unlisted Company) 10%
Interest 10%
Royalties 15%
Management Fees 5%
Supply of Goods 2%
Insurance Premiums 5%
Rent 10%
Money Transfer Commission 10%
Other payments 15%
Branch Remittance Tax 10%
  • The Income Tax Act permits incorporated businesses to choose any period end. However, law prescribed for unincorporated businesses, banks and insurance companies to have an accounting period ending on 31st December of each year.
  • Companies must file provisional tax returns by the end of the third month of their year of income and file their final tax returns within six months after the end of the year of income.
  • Companies may revise their provisional return and file a revised return in the 6th, 9th or 12th month of the year of income if new developments suggest an increase or decrease in income.

Double Tax Treaty

Double Tax Agreements (DTA) regulates the tax treatment of income or capital gains in situations where the same taxpayer is taxed twice in two countries for the same subject.  DTA Treaties are important for developing countries as they play a great role in attracting foreign investments, expertise, modern technology etc. Tanzania has double taxation treaties with Canada, Zambia, Sweden, Italy, India, Denmark, Norway, Finland and South Africa.

Trademark registration

For trademark registration in Tanzania, an application needs to be made to the Tanzanian Trademark Office. It takes approximately 6-8 months. timeframe to complete the trademark registration process. A Trademark Registration in Tanzania is valid Seven years from the date of filing trademark and is renewable for ten years period for an unlimited number of times by paying the renewal fee before the expiration date.

YourGlobalPro professionals are fully equipped to assist you with the trademark registration process for your business in Tanzania. For assistance or advice in the matter of the trademark registration in Tanzania or intellectual property - please feel free to write or contact us.

Secretarial Compliance

Below are some of the important points in relation to Company Secretarial Compliance in Tanzania:

  • All Companies must have Registered office
  • There must be a minimum of two Directors and two shareholders
  • The authorised share capital normally, dependent on the business sector, must be a minimum has prescribed.
  • All companies are required to mandatorily present to a general meeting of the company, copies of its financial reports in respect of each accounting period
  • A director must not be less than 21 years old and be older than 70 years old
  • All legal documents are executed by a company by either two directors or a director and a company secretary, and by affixing of the company seal.
  • The first auditor may be appointed by a resolution of the directors at any time before the first Annual General Meeting.
  • Any company registered under the Companies Act, except a company operating under a Certificate of Compliance, is required to appoint a Company Secretary.
  • The duty of the Company Secretary includes amongst other things maintaining the statutory books of the company and filing the relevant returns.
  • Every limited liability company and a company limited by guarantee must at least once in every year prepare an Annual Return within fourteen days of the Annual General Meeting and file with the Registrar of Companies within 28 days of the return date.
  • A public limited liability company, the return must be filed together with a certified copy of the audited financial statements
  • Association, society and NGO must also file Annual Returns of the previous year latest by 31st March in the prescribed form signed by 3 officers of the society

Accounting Services

The Entities in Tanzania are required agreed on the financial period end at the time of submission of the application of the TIN. And entities are required to maintain proper books of accounts.

YourGlobalPro professionals can assist you with the entire bookkeeping and accounting services for your Tanzania Business Setup as per your business needs including implementation of financial accounting software, accounting records preparation and time to time preparation of budgets, forecasts.

Auditing service

In Tanzania, all companies formed under The Companies Act, 2002, are required to have their financial statements audited at the end of each financial year. The first period end for the preparation of audited financial statements can be 18 months from the date of commencement of business. Based on the size of the business - the companies are required to prepare and file financial statements with the Authority. YourGlobalPro professionals CAN provide you auditing services as required by your business.

Banking

The Bank of Tanzania is the central bank of the United Republic of Tanzania which is responsible for issuing the national currency, the Tanzanian shilling. The accounts can be opened and maintained in multi-currency and is available for all major currencies with the commercial Banks. The documentation requirement differs from Bank to Bank and need to be complied for the Bank account opening. The major banks in Tanzania are AccessBank Tanzania, Advans Bank Tanzania, Akiba Commercial Bank, Amana Bank, Azania Bank, BancABC, Bank M, Bank of Africa Tanzania, Bank of Baroda (Tanzania), Bank of India (Tanzania), Barclays Bank of Tanzania, Citibank, Commercial Bank of Africa (Tanzania), CRDB Bank, DCB Commercial Bank, Diamond Trust Bank Tanzania, Ecobank, Equity Bank (Tanzania), Exim Bank (Tanzania), First National Bank of Tanzania, FBME Bank, Habib African Bank, I&M Bank (Tanzania), International Commercial Bank, Kenya Commercial Bank, Mkombozi Commercial Bank, National Bank of Commerce (Tanzania), National Microfinance Bank, NIC Bank Tanzania, People's Bank of Zanzibar, Stanbic Bank Tanzania Limited, Standard Chartered Bank, United Bank for Africa, UBL Bank Tanzania Limited, Mwalimu Commercial Bank. All banks are stable, reliable and offer the same level of services. YourGlobalPro professionals can facilitate all the paper work in relation to banking need and can assist you in opening bank account for your business plan in Tanzania.

Legal and Compliance

In Tanzania, the responsibility of legal and compliance is not a one-time affair, but a continuous process. Below is the various Tanzania legal and compliance requirement to be followed by incorporated entities:

  • To register with the Tanzania Revenue Authority (TRA) for a Tax Identification Number
  • Registration for VAT is required by companies with an annual turnover of TZS100 million.
  • Tax Clearance Certificate is obtained from the TRA prior to making an application for a business license
  • All entities must have a business license specific to its type of business � to be obtained from the Ministry of Industry, Trade and Investment, or relevant Municipal Council, depending on the type of business.
  • The financial report of all companies to be delivered to business Registration and Licensing Agency (BRELA) within ten months of the end of the accounting period.
  • After the registration of a business with BELRA, other licenses and permits that are required to be obtained as per the industry in which the business fall need to be obtained.
  • The Branch of foreign companies are required to submit accounts in such form, contain such particulars and together with such other required documents, as if the branch were a company incorporated under the Companies Act.
  • The company name must be engraved legibly on the company seal.
  • A company must also have its name and registered office mentioned in legible letters on all business letters of the company; notices; their official publications of the company; and invoices, receipts and letters of credit.
  • All employees and directors/partners/sole proprietor are also required to have an individual TIN.
  • A company operating under a Certificate of Compliance is required to file a return showing the Company Secretary in the country of origin.
  • Associations, NGOs and societies must file their annual returns with Registrar of NGOs.
  • Tanzania does not impose foreign-exchange controls on current account transactions, but the Bank of Tanzania must be notified of foreign capital-account transactions.

YourGlobalPro professionals can assist you in Tanzania Legal and compliance requirements.

HR and Employment Law and Immigration / VISA

In Tanzania, the foreigners are allowed to work on work visas and work permit. Below are some of the important points in relation to HR and employment law in Tanzania:

  • Employee is allowed under the law to work is forty-five (45) hours meaning nine (9) hours a day -Exclusive of the one hour daily lunch break.
  • Employee is permitted to work six days in a week and the seventh day must be a resting day.
  • Law prohibits an employee to work more than 50 overtime hours in any four-week cycle.
  • Normally, if an employee work overtime employer will be required to pay them one and one half times the employee's wage for any overtime worked
  • Overtime hours are worked on a resting day on a public holiday then the employee will be compensated at the rate of double the ordinary rate for every hour worked.
  • Work at night by Children under 18 years of age or by A pregnant employee two months before the expected date of confinement or by an employee who is medically certified as unfit to do night work or Mothers for a period of two months after the date of birth is prohibited
  • Foreign nationals must have visas to enter Tanzania, unless they are nationals of countries that have waived the visa requirement.
  • Foreign nationals wishing to be employed in Tanzania must obtain both a work permit and a residence permit.
  • The permits are issued initially for a period of up to two years and are renewable.
  • The employer must file for review and approval a completed application pack with the Labor Commissioner at the Ministry of Labor, the Tanzania Investment Center (if the business is registered with the Tanzania Investment Center) or the Zanzibar Investment Promotion Authority.
  • To obtain a residence permit, after obtaining a work permit from the Ministry of Labor, a foreign national must file for review and approval a completed application pack with the Commissioner-General of Immigration.

Country Statistics

Capital Dodoma
Largest city Dar-es-Salaam
Area Total 947,303 km2
Population 51,820,000
Density 47.5/km2
Currency Tanzanian shilling (TZS)
Government Unitary presidential socialist republic
Official Language None de jure
Religion Christians: 61.4%
Muslims: 35.2%
Folk Religion: 1.8%
Irreligious: 1.4%
Other: 0.2%
Government Offices Monday to Thursday: 07:30 a.m. - 4:00 p.m. Friday: 07:30 a.m. - 1:00 p.m. Saturdays, Sundays & public holidays: closed
Business Offices Monday - Friday 08.30 to 16.00 - Saturdays, Sundays & public holidays: closed
Banks and Exchange Houses Monday-Friday 08.30 to 16.00 - Saturdays, Sundays & public holidays: closed

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