Private Limited Company (Yekefele Hegn Mahber)Ethiopia
What it takes to form, own and run a private limited company in Ethiopia, and how its profit is taxed. Each figure links to the page it was read from.
This company type
At a glance
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board of directors, if any, shall consist of three to seven members.
The registry’s and the law’s own pages do not mention it.
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በድርጅት ላይ ተፈፃሚ የሚሆነው የንግድ ሥራ ገቢ የግብር መጣኔ ሰላሳ በመቶ (፴%) ነው፡፡
Form it
Who registers it
- Registry
- Ministry of Trade and Regional Integration (central commercial register; regional trade bureaus and the Ethiopian Investment Commission register and forward to it)
- Formed without visiting
- Not stated
The registry’s and the law’s own pages do not mention it.
- Formed online
- Not in our records
What it takes to form
- A notary
- Required
- A resident director
- Not stated
The registry’s and the law’s own pages do not mention it.
- Paying up the capital
- Capital is fully paid in advance (Commercial Code art. 495(1)).
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whose capital is fully paid in advance, divided into
Own it
Who may own and run it
- Directors
- A company may be one
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board of directors, if any, shall consist of three to seven members.
- Shareholders
- At least 2 · at most 50
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A private limited company may not have less than two
- Members
- At least 2 · at most 50
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A private limited company may not have less than two
- A local company secretary
- Not stated
The registry’s and the law’s own pages do not mention it.
- A local registered agent
- Not stated
The registry’s and the law’s own pages do not mention it.
Each year, at the registry
- Annual registry fee
- Not stated
The registry’s and the law’s own pages do not mention it.
- Accounts on the public record
- Not stated
The registry’s and the law’s own pages do not mention it.
- Audit for a small company
- Not stated
The registry’s and the law’s own pages do not mention it.
- Audit
- Share companies and private limited companies must have financial statements audited by an auditor every fiscal year and submit reports (Proclamation 980/2016 art. 26(8)).
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company shall cause audit of his financial
Important dates
When each obligation falls due, as the authority states it.
- Audit of the financial statements by an auditor every fiscal year, with report submitted
- Not in our records
Not stated on justice.gov.et when checked
What is public
Not in our records What the register shows the public is not in our records for the Private Limited Company (Yekefele Hegn Mahber).
Tax
Tax on profit
How this company type is taxed, which can differ from its place’s headline rate.
Flat · 30%
Business income tax on a body (ድርጅት) is thirty percent (Proclamation 979/2016 art. 19(1)).
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በድርጅት ላይ ተፈፃሚ የሚሆነው የንግድ ሥራ ገቢ የግብር መጣኔ ሰላሳ በመቶ (፴%) ነው፡፡
Work it out on a profit figure: the company’s tax, the owner’s, and what is left.
- CFC rules in Ethiopia
- Not in our records
Close it
Closing it
The other end, which most guides leave out.
- Route
- Dissolution where members agree (art. 181(3)); the share-company winding-up rules (arts. 473-491) apply, ending with the liquidators having the company's registration cancelled from the commercial register (art. 489(1))
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3/ members agree to dissolve the business organization;
- Statutory fee
- Not in our records
Every business in Ethiopia
VAT
- Standard rate
- 15%
Value Added Tax Proclamation No. 1341/2024 (Federal Negarit Gazette No. 61, 21 August 2024), art. 8(2): 15 percent, with zero percent for zero-rated supplies. Read on the Ministry of Justice's law site (justice.gov.et), which lists the Proclamation as in force.
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b) in any other case 15 percent.
- Other rates
- 0% Zero-rated supplies
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a) for a taxable supply that is a Zero-rated supply, Zero percent, or
- Registration threshold
- ETB 2,000,000
total value of taxable supplies, or such other amount as the Ministry's directive sets (art. 12); 12 calendar months
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The registration threshold is 2,000,000 Birr or such other amount as specified in the Directive to be issued by the Ministry.
- A foreign company
- The same threshold applies
Art. 64 applies the art. 12 liability to register to a person carrying on a taxable activity outside Ethiopia with no fixed place of business there, so the threshold applies. It does not require a VAT representative as a rule: the Tax Authority may require security, and may require a VAT representative if the person then fails to comply, so representative_required and registers_from_first_supply stay open.
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the Tax Authority may require a person carrying on a taxable activity outside Ethiopia who is liable to be registered under Article 12 of this Proclamation but who does not have a fixed place of business in Ethiopia to lodge security
- Returns filed
- Monthly
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“Accounting Period” means each calendar month.
- Tax authority
- Ministry of Revenues, Federal Democratic Republic of Ethiopia
Payment and banking services
None of the services whose lists we hold names Ethiopia. Each provider, and what a listing means.
Reference
Its name and code
- Kind
- Private limited companyDerived our grouping, the same words in every country
- Name in law
- Private Limited Company (Yekefele Hegn Mahber)
- Identifier
- ET-PLCA form ISO 20275 does not list.