How to Register a Sole Proprietorship in Bhutan
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The Kingdom of Bhutan is a landlocked country in the Eastern Himalayan region. Bhutan’s economy has quickly developed over the years, and in 2007 it was the second-fastest-growing economy in the world. It is based on farming, woodcraft, tourism.
Disclaimer: Be aware that this article is not a substitute for legal advice. Please always check official websites or seek legal advice before you take action.
How to register a sole proprietorship in Bhutan
You should submit a company name search application to confirm the uniqueness of the wanted business name. No business shall be joined with a name which, in the opinion of the Registrar, is unacceptable or is equal to another business’s name. There is a possibility to carry name exploration and approval online. Name search is free, and after approval, it is possible to reserve the name at a fee of BTN 2,000.
Security Clearance Certificates (SCC) in Bhutan
The following step is to obtain Security Clearance Certificates (SCC). The security clearance certificate is valid for one year. It can be issued online with the Office portal. This process requires no more than a day, and it is free of charge.
Submit a project outline to the Industrial Department Division (IDD) of the Ministry of Economic Affairs
Submitting a project outline to the Industrial Department Division (IDD) of the Ministry of Economic Affairs is an important step that follows.
For small and cottage-scale businesses with a startup capital of up to BTN 10 million, the Regional Trade & Industry Office of the Department of Cottage and Small Industries reviews the project plan. The project plan approval is needed to confirm that the proposed industrial project is in line with the industrial development plans of the country and for the issuance of the industrial license. Online services of the Department of Cottage and Small Industry are available here. After presenting the project plan online, you may be asked to submit extra documents or give further requirements in person.
To complete the registration process, you will need to present your ID card with the additional documents:
- Articles of Incorporation
- Business name clearance form
- Declaration of compliance
- Name and Address of the owner
- Security Clearance Certificates
You will then obtain your business declaration of incorporation. Once the documents are processed, the Registrar of Companies announces the certificate of registration.
The process of registration could be held online via this site.
Business license in Bhutan
When you’ve got your declaration of incorporation, you should obtain a business license.
To apply for the license, submit the following documents:
- Application Form for Industrial License
- ID Card
- Sector Clearance (depending on activity)
- Location Clearance obtained from the Thimphu City Corporation (Dzongkhag or Thromde)
- Proven Security Clearance Certificate
- Two photos
- Project Approval from the Department of Cottage and Small Industry for the cottage.
You can download the application forms from the Ministry of Trade and Industry’s site.
Tax registration in Bhutan
Every business needs to enroll for corporate income tax. At that point, a Business Identification Code (BIC) will be assigned to the business. This BIC number must be assigned for participation in public tenders and works. After registering, you will get the BIC.