How to Register a Sole Proprietorship (Empresa em Nome Individual) in Mozambique

Setting up as an independent contractor in Mozambique is appealing because it gives you flexibility, autonomy, and the ability to invoice clients directly. However, it’s not entirely frictionless. You’ll face bureaucracy, paperwork, and compliance costs. The main challenges include administrative delays, licensing fees, and meeting tax and social security obligations. The benefits are control over your work, direct client relationships, and the ability to operate under your own name with relatively low overhead.

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 in Mozambique?

In Mozambique, a sole proprietorship is commonly called empresa em nome individual. It may also be referred to as:

• Sole trader
• Self-employed individual
• Independent contractor

These terms all describe the same model: one person running a business without forming a corporation, with the owner and business legally the same.

How does a sole proprietorship (empresa em nome individual) work in Mozambique?

Empresa em nome individual vs. other business structures in Mozambique

There are alternative business structures in Mozambique for individuals who wish to separate their personal and business liabilities, raise capital, or work with partners. The most common alternative to a sole proprietorship is the limited liability company (sociedade por quotas, Lda). Below is a comparison highlighting the main differences between these two models.

Step-by-step guide: How to register a sole proprietorship in Mozambique

Step 1: Check your eligibility

To register an empresa em nome individual, you must be a natural person. Mozambican citizens can apply directly using their national identification documents. Residents with legal residence status in Mozambique are also eligible to register, provided they hold a valid residence card. Foreign nationals may register if they have a valid residence permit or business visa, and a work permit when required. Each individual is allowed to operate only one empresa em nome individual at a time.

Step 2: Choose your business name

You may operate under your personal name followed by “E.I.”, or select a trade name. If you choose a trade name, you must first reserve it through the Legal Entities Registry (Conservatória do Registo Comercial).

Step 3: Gather required documents

You will typically need:

• Identity document (national ID or passport)
• Proof of residence or address
• For foreigners: a residence permit or a valid business/work visa
• Unique Tax Identification Number (NUIT)
• Name reservation certificate (if applicable)

Step 4: Register with the authority

You can submit your application either in person at a BAU office or online via the government portal. Registration involves submitting the required forms, your name reservation certificate, identification documents, and paying the registration fee. Once approved, you receive a certificate of registration confirming your legal business status.

Step 5: Pay registration fees and contributions

You will need to pay a registration fee. Depending on your municipality and sector, you may also need to pay for municipal operating licenses or additional sectoral permits. While the registration cost itself is modest, you should budget extra for notary fees and license renewals to ensure full compliance.

Step 6: Complete post-registration obligations

After registering your empresa em nome individual, you must maintain comprehensive accounting records. If you are registered for VAT, file monthly VAT returns by the last business day of the following month. For personal income tax (IRPS), tax returns are filed between January and April of the year following the tax period. In many cases, businesses and individuals are expected to retain accounting documents, invoices, and receipts for extended periods (up to ten years in some contexts). You should verify local licensing and municipal obligations, including periodic renewal requirements. Noncompliance may result in fines, penalties, or administrative consequences.

Financial and tax obligations for sole proprietors in Mozambique

You are responsible for:

• Income tax/business profits: Income for sole proprietors is taxed progressively under the personal income tax regime (IRPS). The 2025 rates range from 10% to 32%, depending on income level. Corporate entities pay a flat 32% rate under Imposto sobre o Rendimento das Pessoas Colectivas – IRPC.
• VAT (Imposto sobre o Valor Acrescentado): The standard VAT rate is 17% on most goods and services. Some categories, such as exports and certain financial services, may be zero-rated or exempt. VAT returns are filed monthly, typically by the end of the following month.
• Social security contributions: Sole proprietors must register with the Instituto Nacional de Segurança Social (INSS) as self-employed contributors. They pay 7 % of their declared income directly to the INSS. If you hire employees, you must also contribute 4 % of each worker’s salary as the employer, while 3% is deducted from the employee’s pay—a total of 7% remitted monthly.
• Record-keeping: You must maintain accurate records of all invoices, receipts, and accounts for at least seven years, as tax authorities may request access during audits.
• Invoicing: Every invoice must include your NUIT, business name, client details, date, description of goods or services, and applicable VAT. Invoices must be numbered sequentially and stored securely for your records.

Launch your contracting career and stay compliant with Deel

Registering as a sole proprietor gives you independence, but it also means handling taxes, invoices, and records on your own. Deel’s all-in-one platform helps you manage obligations without the stress. With Deel, you can:

• Automate invoicing and expense tracking with essential Bookkeeping tools
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• Keep accurate records for tax season
• Access expert tax advice and compliance support
• Get paid through multiple payment and withdrawal methods
• Spend your earnings in USD with the Deel Card
• Access funds early with Deel Advance
• Enjoy contractor perks from 150+ partners

Stay independent, without the admin overload. Sign up to Deel for free today.

FAQs

What is the minimum capital required to start an empresa em nome individual in Mozambique?
There is no formal minimum capital requirement, though in certain sectors, you may need to show financial capacity when applying for licenses.

Do empresas em nome individual need to register for VAT?
Only if their turnover exceeds the state threshold. Below that threshold, you may be exempt.

How much are the standard registration or ongoing fees?
The registration fee is modest, but you may also need to pay municipal or industry-specific fees depending on your business type.

Can an empresa em nome individual hire employees?
Yes. You must register with the INSS and comply with Mozambique’s labor laws.

How long does it take to register?
Registration usually takes 7 to 15 days via the E-BAU system, and up to 30 days using traditional methods.

Can foreign nationals register as an empresa em nome individual in Mozambique?
Yes, provided they hold a valid visa, residence permit, and work authorization if required.

Do empresas em nome individual need a separate business bank account?
It’s recommended for clarity and professionalism, especially for tax compliance and audit purposes.

What happens if I stop working as an empresa em nome individual?
You must inform the AT, file a final tax return, and cancel your registration and licenses.

Are there any government incentives or reduced rates for new empresas em nome individual?
Investment incentives exist under Mozambique’s Investment Law 8/2023 for priority sectors, but not specifically for sole proprietorships.

Can I use Deel as an empresa em nome individual to get paid by international clients?
Yes. Deel supports freelancers and independent contractors in receiving international payments in multiple currencies with transparent fees.

Does Deel generate compliant invoices for empresas em nome individual?
Yes. Deel automatically issues legally compliant invoices aligned with Mozambican tax rules.

Can Deel help me with taxes as a sole proprietor in Mozambique?
Deel provides downloadable tax reports and payment summaries to assist with filing, simplifying compliance, though not replacing an accountant.

Does Deel offer contracts for freelancers and empresas em nome individual?
Yes. Deel offers locally compliant contract templates so you can work securely with clients worldwide.

Can I access benefits through Deel as an empresa em nome individual?
Yes. Deel provides optional benefits such as health coverage, savings tools, and professional perks to help independent workers gain financial security.