Doing business in Tajikistan
- How quickly can I set up a business?
- What is the minimum investment needed?
- How can I raise finance?
- What are the legal requirements for setting up my business?
- What structure should I consider?
- What advice can you give me in regards to payroll and taxation requirements?
- Is there anything else that I should know?
How quickly can I set up a business?
Up to 30 days
What is the minimum investment needed?
Tajik Legislation does not provide the amount of minimum investment in the Republic of Tajikistan, but in practice, the investment shall start from 10 000 USD as the minimal amount of the charter capital of newly establishing a company with foreign capital.
How can I raise finance?
Immovable property, monetary funds, shares (stocks, securities other financial instruments) or other types of participation in the charter capital of the legal entities, property rights, intellectual property rights or other type of non-property rights, other types of rights allowed by the legislation / any activity, excluding the activity prohibited by the legislation due to ensure of national interests.
What are the legal requirements for setting up my business?
Legislation does not provide any requirements for the structure of the company with foreign investments.
Option 1 is to set up the legal entity in the Republic of Tajikistan.
Option 2 is set up the legal entity in one of the four free trade zones.
What structure should I consider?
The legislation of the Republic of Tajikistan allows one to set up the investment activity in the form of legal entity, branch office and representative office of the foreign legal entity.
The branch office and representative office of a foreign legal entity is not a separate legal entity and represents only interests of a foreign legal entity in the Republic of Tajikistan. Contrary to the representative office, the branch office is entitled to conduct any trade and commercial activity in the Republic of Tajikistan on its behalf.
• 2 or more individuals.
• Jointly and unlimitedly, to the extent of their personal assets.
• Shall be in compliance with the civil code of the Republic of Tajikistan.
• No registration required.
Limited Liability Companies
• Shareholders have limited liability;
• Net profit is distributed between shareholders according to amount of share.
• Shall be in compliance with the civil code of the Republic of Tajikistan and the law on limited liability companies.
• Registration process is very simple.
Joint Stock Companies
• Stockholders have liability within its number of stocks.
• Registration process is quite difficult due to emission and registration of stocks.
• Net profit is distributed among stockholders according to the number of stocks;
• Shall be in compliance with the civil code of the Republic of Tajikistan and the law on joint stock companies.
• Members of cooperative can be both individuals and legal entities.
• Liability of each member is limited by the nominal value of its share.
• Maximum number of shares of one member shall not exceed 13% of total numbers of shares.
• Shall be in compliance with the civil code of the Republic of Tajikistan and the law on cooperatives.
What advice can you give me in regards to payroll and taxation requirements?
• Hiring of foreign employees is the subject of licensing and obtaining of work permission.
• Tax system has two major system of taxation: a) simplified and b) general. Simplified tax system has one type of the simplified tax that covers VAT, corporate profit tax at the rate of 6% from total turnover. The maximum turnover for simplified tax system is 90 000 USD. In case of exceeding of this maximum, the legal entity shall move to the general tax system and shall became the taxpayer of corporate profit tax (23%) and VAT (18%).
• In addition, branches of foreign legal entities are the subject of taxation of WHT in amount of 15% on net profit and in case of legal entity 12% of dividend tax.
• Tax system also have special simplified tax regimes for producing of cotton and construction of HPP.
Salaries in Tajikistan are subject to the taxation of individual income tax (13%) and social tax (1%). As for the employer, he/she must also pay social tax in the amount of 25% of total wages. For foreign employees, the rate of WHT is fixed in the amount of 25% of the amount of salary.
Is there anything else that I should know?
The main foreign investments in Tajikistan are allocated in mining (mainly in gold mining), oil and gas, telecommunication industries. A small percentage of foreign investments are allocated in the financial sector.
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