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Company registration fees in Iran

Company registration fees in Iran

<img src="Iran-fees.jpg" alt="Company registration fees in Iran"/>
Company registration fees in Iran

Do you know hot mush cost stand to setup a business in Iran? We are giving you a picture of company registration fees in Iran. The Islamic Republic of Iran, the Middle Eastern giant stretching up to an area of 636,400 mi² with comparatively a young and dynamic population grossing per capita GDP of 4,957.58 USD. The currency is Iranian Riyal [IRR] equivalent to 0.00003 USD.

The Iranian economy has the potentiality and infrastructure to become the largest economy in the Middle East as it owns 80,500 km plus roads and 10,400 km of railways connecting the Asia with Europe save 30% on all international transit costs. It ranked 120th in the Ease of Doing Business Index and 102nd in the Starting a Business Index of the World Bank’s Doing Business Report 2016, out of 190 countries of the world. The report sees how easy or difficult to open and operate a small or medium-size business for an entrepreneur complying with relevant regulations. The soil of Iran is rich in natural resources containing 2nd largest natural gas reserves and coppers mine in the world. It is the number two cement producer in the region and eighth in the world.

The Law and the legal forms of Companies

Trade and commerce in Iran are governed and regulated by the Commercial Code, Civil Code and the Attraction and Protection of Foreign Investment [FIPPA]. The registration authority in Iran is the Commercial Registration Office.

The Forms of Business Association

The Iranian Commercial Code prescribes following types of business entities to operate legally:

  • Limited liability company (Sherkat ba Masouliyat Mahdoud)
  • General partnership (Sherkat Tazamoni)
  • Limited partnership (Sherkat Mokhtalet Gheyr Sahami)
  • Joint Stock Company [Sherkat Sahami Am] , can be Private or Public
  • Mixed joint stock partnership (Sherkat Mokhtalet Sahami)
  • Proportional liability partnership (Sherkat Nesbi)
  • Production and consumption cooperative (Sherkat Ta’avoni Towlid va Masraf)

Among these, the most visible and purposive business vehicle is the Limited Liability Company [LLC]

The Limited Liability Company [LLC]

A Limited Liability Company [LLC] requires two shareholders minimum and ten as maximum to legally form. There is no prescription for minimum share capital requirement to establishing a Limited Liability Company in Iran.

The Limited Liability Company Registration Processes and costs

In about eight steps a limited liability foreign company can be registered in Iran with the Commercial Registration Office. However, there are processes with or without any fees or charges required.

Getting Police verification and clearance

A mandatory Police criminal record clearance is required first for all the directors or the share holders of the proposed company under articles 111 and 147 of the amendments to the Commercial Code of 1969.

 IRR100,000 have to pay to the Justice department for the job, in addition to IRR 50,000 per criminal record.

Reserving a unique company name and registration at the Companies Registration Office [CRO]

Application to be addressed to the CRO with AoA, particulars of share holders and directors as well, Minutes of the general assembly and meetings of the share holders.

The procedure costs IRR 40,000 for name search and reservation and IRR 375,000 for company registration fees in Iran.

General circulation of the company formation

A notice confirming the formation of the company has to be published in the official Gazette and in selected newspapers. The publication of the same may take 2 to 4 weeks. The businesses don’t have to wait till publication to starting the operation.

The fee of IRR140,000 for official Gazette and  IRR 240,000 for newspaper circulation are required

Notifying the State Tax Affairs Organization of the commencement of business activities

Within four months of registration, as per Article 177, Note 3 of the Direct Tax Act, the new company must notify the State Tax Affairs Organization [a Department under Ministry of Economic Affairs and Finance] in writing of its commencement of business operations. Penal action will be in force if not done so.

This process of registration cost no charge.

Registration for VAT

Companies now required proceeding to the State Tax Affairs Organization for VAT registration. This registration can be done online through www.evat.ir.

This process of registration cost no charge.

Retrieving the sealed books of accounts of the company

Within 30 days of registration, this has to be done. The costs of the official sealed books of account depend on the number of pages these contained.

 Well, the standard cost is IRR 100,000

Paying the share certificate stamp duty

Within 60 days of registration, this duty has paid to the designated Bank Melli in accordance with the provision of the Article 48 of the Direct Taxation Act.

This requires 0.05% of the par value of the subscribed share capital as costs.

Enrolling of employees in the social security program

The first monthly payroll statement is to be sent to the Iranian labor Department, showing a premium contribution equivalent to 33% of the monthly payroll to open a file in the Social Security Program.

This process of registration cost no charge.

Opening a Branch

A local branch office is the extension of the parent company. It usually meant for carrying out the objectives and business transaction for the parent company. The operation of the branch office will be conducted under the name and responsibility of the parent company. The branch office is subject to the Iranian laws concerned with the labor, social security, taxation, etc. The Branch office can sign and perform contracts on behalf of its parent.

Opening a Representative Office [RTO]

The Representative of Foreign Company can either be a natural person or a legal entity. It cannot, under any circumstance, sign or perform any contract or commercial activity that produces financial benefits. The Representative(s) of a foreign company shall be responsible for the activities carried out locally on behalf of the main company. The RTOs in Iran are not subject to the Iranian laws relating to labor, social security, taxation, etc.

The costs of registering a Branch or an RTO

Although there are no fees specified for these to register, but approximately 150 US dollars would be company registration fees in Iran each of the wings.

Note: If you like to register pvt ltd company in Iran as foreigner is requested to contact us.

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