If you plan to start a business in Africa, Botswana is a good choice for registering your company. The Manimama Law Firm has conducted in-depth research, analyzed the main subtleties of incorporating in Botswana, and is ready to share its results and help you choose the right jurisdiction.

What are the main advantages of incorporating a company (business) in Botswana?

1. Political and Economic Stability

Botswana is considered one of the most stable countries in Africa, both politically and economically. Since gaining independence, it has maintained steady economic growth driven by sound macroeconomic policies.

2. Promising Location and Access to Regional Markets

Centrally located in Southern Africa, Botswana serves as a key gateway to the Southern African Development Community (SADC) market, which encompasses over 300 million people. Trade agreements with neighboring countries offer companies registered in Botswana streamlined access to regional trade—an especially valuable advantage for businesses planning to scale across the region.

3. Favorable Tax Regime

Botswana offers a competitive tax system, including a corporate tax rate of 22% and tax incentives for certain sectors. A major benefit is the general absence of withholding tax on dividend income for foreign shareholders.

4. Established Legal System and Investor Protection

Botswana has a well-developed legal framework based on the British common law system, with a strong emphasis on property rights and contract enforcement. Foreign investors enjoy the same rights as local citizens, fostering a level playing field.

5. Access to Skilled Workers and Reliable Infrastructure

The country has a growing pool of educated, English-speaking professionals, supported by government investment in education. Botswana also boasts well-developed infrastructure—roads, telecommunications, and energy—that supports efficient business operations. This makes it a suitable environment for both local startups and regional headquarters.

How to register a company in Botswana and what are the main requirements for such registration?

Step 1. Initial setup

• Initiating a preliminary project assessment, assessing risks, choosing the type of company, preparing the necessary documents and obtaining the necessary permits, determining the time frame, budget, and resources required to complete the process.
• Preparation and filing of the package of documents.

Step 2. Company registration

• Choosing a suitable corporate entity;
• Reserve a company name through the Companies and Intellectual Property Authority (CIPA);
• Preparation and submission of incorporation documents;
• Obtain an industrial license or trade license (if applicable);
• Opening a bank account;
• Obtain a tax identification number (TIN) from the Tax authority;
• Register for Value Added Tax (VAT) Register employees for workplace injury insurance.

Requirements for registering a company in Botswana on the example of a Limited Liability Company (LLC):

• Number of directors: a Botswana LLC must appoint 1 director who must be a resident of Botswana;
• Number of shareholders: 1 shareholder of any nationality;
• Share capital: minimum paid-up capital is not required;
• Liability: the liability of its shareholders is limited to the amount of capital they have invested in the company through their shares;
• Accounting: companies must register with the Botswana Unified Revenue Service (BURS) for a Taxpayer Identification Number (TIN) upon incorporation.

What do you have to know about taxes when registering a company in Botswana?

Corporate income tax (CIT):

• The standard corporate tax rate in Botswana is 22% for resident companies. Non-resident companies are taxed at the same rate on their Botswana-sourced income.
• A reduced rate of 15% applies to companies operating in specific manufacturing industries, IFSC companies and those providing certain financial services approved by the Minister of Finance.
• Capital gains from the sale of business assets are generally taxable, subject to exemptions or deductions based on specific cases.

Personal income tax (PIT):

Botswana uses a progressive tax system for personal income. The rates range as follows:

• 0% for annual taxable income up to BWP 48,000.
• 5% to 25% for income exceeding this threshold, with the top marginal rate of 25% applying to annual income above BWP 156,000.

Taxable income includes salaries, benefits, and allowances, with some deductions allowed, such as contributions to retirement funds​.

Value-added tax (VAT):

• The standard VAT rate is 14%. This applies to most goods and services provided within Botswana.
• Exemptions include specific services like healthcare, education, and public transport, and some zero-rated items include exports and basic foodstuffs.

Withholding taxes:

• Dividends: 10% (residents and non-residents),
• Interest: 10% (residents)/15% (non-residents),
• Royalties: 0% (residents)/15% (non-residents).

For readers 

Manimama provides assistance in choosing the right jurisdiction for company incorporation and in registering a business specifically in Botswana. We have a good understanding of the tax and legal peculiarities of specific jurisdictions, which helps our clients make an informed choice based on their unique needs and development strategies. In our work, we take into account factors affecting the business environment, such as the level of competition, access to financial and human resources, as well as opportunities for further growth and development in different jurisdictions. 

By choosing our company formation service in Botswana, you are working with a law firm that values integrity, competence, and client satisfaction. Let us help you set up a company in Botswana and pave the way for your business success!

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The content of this article is intended to provide a general guide to the subject matter, not to be considered as a legal consultation.