How to Register a Sole Proprietorship (Business Name) in Eswatini

Many independent contractors and freelancers find the sole proprietorship structure attractive because it offers simplicity, direct control, and minimal layers of governance. In Eswatini, however, the legal framework does not use the exact term sole proprietorship. Instead, individuals register a business name with the Registrar of Companies under the Ministry of Commerce, Industry, and Trade. This process effectively serves the same purpose: it gives you the ability to operate as a one-person business, invoice clients, and meet your tax obligations.

The process can lean more toward bureaucratic than minimal, particularly when interfacing with government offices for registration, name reservation, licensing, and tax registration. Costs, documentation, and compliance may present hurdles for new entrepreneurs. But the benefits remain compelling: you gain legal recognition, the ability to invoice clients, and access to formal tax and regulatory systems.

Disclaimer: This article is for informational purposes only and is not a substitute for legal advice. Please always check official sources or seek professional guidance before taking action.

What is a sole proprietorship (business name) in Eswatini?

In Eswatini, there is no universally recognized legal concept equivalent to a “sole proprietor” (sometimes sole trader, self-employed, or independent contractor) that operates entirely outside formal business registration.

In practice, independent entrepreneurs instead register a business name under the Registrar of Companies or the relevant commerce department, and operate under that registration.

How does a sole proprietorship (business name) work in Eswatini?

Sole proprietorship (business name) vs. other business structures in Eswatini

There are alternatives to registering as a sole proprietor. Many entrepreneurs choose to form private limited companies (Pty Ltd) or partnerships, depending on their long-term business goals, financing needs, and liability concerns. The table below provides a comparison between sole proprietorships (business names) and private limited companies.

Step-by-step guide: How to register a sole proprietorship (business name) in Eswatini

Step 1: Check your eligibility

You must be a legal resident or citizen with valid identity documentation. Foreign nationals may require a valid permit or local presence. Ensure you have proper identification (e.g., passport, national ID) and proof of address. Also, confirm that your business activity is permitted under local laws.

Step 2: Choose your business name

Use the government portal to search and reserve a business name. The reservation is typically valid for 90 days. Choose a name that is distinctive, not misleading, and not already registered.

Step 3: Gather required documents

You will typically need:

• National ID or passport
• Proof of physical business address or lease agreement
• Name reservation confirmation
• Completed registration forms (available via the government or commerce portal)
• Any permits or licenses for regulated business types

Step 4: Register with the Department of Commerce / Registrar of Companies

Submit your documents and application to the Registrar of Companies via the Department of Commerce under the Ministry of Commerce, Industry, and Trade. You may also register online through the government portal. Once approved, you will obtain your business registration certificate.

Step 5: Pay registration fees and contributions

The registration fees depend on the nominal capital of your business. For example, businesses with a nominal capital of up to E10,000 pay E645, while those above E50,000 pay E1,845. If your business falls within the E30,000 capital range, the fee is E945. These payments are made at the revenue office or online, and proof of payment must be attached to your application. In addition, you may need to pay a small fee for an advertisement (E50) when applying for a trade license.

Step 6: Complete post-registration obligations

After registering, you must comply with ongoing obligations. This includes registering for a Taxpayer Identification Number (TIN) with the Eswatini Revenue Service (ERS), submitting annual tax returns, and registering for VAT if your turnover exceeds E900,000. You must also maintain accurate accounting records and ensure renewals or updates to your business license are filed on time. If you cease trading, you must inform the Registrar of Companies and deregister with ERS to avoid penalties.

Financial and tax obligations for sole proprietors (business names) in Eswatini

You are responsible for:

• Income tax: Eswatini does not levy a separate corporate income tax on sole proprietors. Instead, business profits are taxed as part of your personal income under the progressive income tax system. Rates currently range from 20% to 33%, depending on income level (Eswatini Revenue Service). Returns must be filed annually with the ERS.
• VAT: The standard VAT rate is 15%. VAT registration is mandatory if your business’s annual taxable turnover exceeds E900,000, but voluntary registration is possible below this threshold. VAT returns are usually submitted quarterly.
• Social security contributions: Sole proprietors are not required to contribute to a standalone self-employed social insurance scheme. However, if you employ staff, you must register with the local social security authorities and make employer contributions to the relevant national schemes.
• Record-keeping: You must maintain accurate and verifiable accounting records, including invoices, receipts, and expense documentation. These records should be retained for audit purposes and compliance checks.
• Invoicing: All invoices must contain essential details: your business name, TIN, client details, invoice date, description of goods or services, and any applicable VAT. Invoices must be numbered sequentially and stored for your records.

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FAQs

What is the minimum capital required to start a sole proprietorship (business name) in Eswatini?
There is no formal minimum capital requirement for registering a business name.

Do sole proprietorships (business names) need to register for VAT?
Only if the annual taxable turnover exceeds E900,000; otherwise, voluntary registration is possible.

How much are the standard registration fees?
Fees depend on nominal capital levels (e.g., E645 up to E10,000 capital, E1,845 for capital above E50,000). Example: if your business is valued at E25,000, you’d pay E945.

Can a sole proprietorship (business name) hire employees?
Yes, once legally registered, you can hire employees and must comply with labor laws and social security contributions.

How long does registration take?
For company registration, incorporation, and registration may take one day after submission (name search, reservation, documentation). In practice, name reservation, compliance checks, and licensing may extend it.

Can foreign nationals register a sole proprietorship (business name) in Eswatini?
Yes, provided they have a valid permit or legal basis. For businesses on Swazi Nation Land, local ownership requirements may apply.

Do I need a separate business bank account?
While not always mandatory, a separate business account is strongly recommended for clarity, auditability, and compliance with banking and tax practices.

What happens if I stop working?
You should formally notify the Registrar of Companies / Department of Commerce and ERS, cancel your tax registration, and settle any outstanding liabilities or tax returns.

Are there government incentives or reduced rates for new sole proprietorships (business names)?
There are no widely publicized special sole-proprietor incentives, but in some sectors or under investment promotion schemes, there may be tax breaks or concessions. Entrepreneurs should check with the Eswatini Investment Promotion Authority (EIPA) or related agencies.

Can I use Deel as a sole proprietorship (business name) to get paid by international clients?
Yes. Deel supports independent contractors and business owners, allowing you to receive payments internationally, convert currencies, and maintain compliance with invoices aligned with local rules.

Does Deel generate compliant invoices for sole proprietorships (business names) in Eswatini?
Yes. Deel can produce invoices designed to satisfy legal and tax requirements in your jurisdiction, including Eswatini, aiding your compliance efforts.

Can Deel help me with taxes as a sole proprietorship (business name) in Eswatini?
Deel provides downloadable reports, payment records, and documentation useful for your tax filings. While Deel does not replace an accountant, it simplifies record-keeping and financial tracking.

Does Deel offer contracts for sole proprietorships (business names) in Eswatini?
Yes. Deel includes contract templates that comply with local laws and global standards, so you can engage clients safely and professionally.

Can I access benefits through Deel as a sole proprietorship (business name)?
Yes. Deel offers optional perks such as health insurance, retirement plan access, and other benefits that resemble those for employees, helping to bring more security to independent work.