If you want to do business in Honduras, reading this will help you becoming knowlegeable on the specific tax laws and rates for a LLC(Sderl) which is the most common company structure in Honduras.
Honduras taxes income accrued abroad in the same way that income earned within the territory. The highest estimated tax rate for offshore income, from our research, and this is not personal tax advice, is 26.28%. Honduras doesn't have known exemptions to transfer in income earned abroad made internationally. Companies in Honduras are subject to a Corporate Income Tax of 25% plus a surcharge of 5% on companies with taxable income over HNL 1m, and a municipal industry, commerce and service regressive tax from 0.03% to 0.015%. Resulting a highest effective tax rate of 26.28%. This ranks Honduras as 126th overall with regards to corp. taxation rate internationally.
The value added tax (VAT) rate in Honduras is 15.00%, that ranks Honduras as 79th overall with regards to VAT globally. In terms of other taxation, an employee will contribute 5% to the equivalent of a social security fund. The overall complexity of the tax system is medium. This is measured by average time to comply with a country's labor tax requirements is as it is 93hours. Contributing to this is the number of yearly labor tax payments, which is 1 in HN.
Thin capitalisation mandates are not in effect. Thin capitalisation refers to any type of requirements on a business and the debt-to-asset ratios. Dividends paid by resident entities to other resident entities are subject to a final withholding tax of 10%. Dividends are distributions of company profits, voted by the board, to a particular class of shareholders. Dividends can be either shares of stock, cash payments, or other property. Capital Gains are taxed separately from CIT and subject to a Capital Gains tax of 10%. A capital gains tax is levied on the profits that a corporation or natural person realizes when he or she sells sells a capital asset for a price that is higher than the purchase price.
The interest withholding tax rate is estimated at 10%. Which means that the tax authorities expects legal entities to pay tax on at least 10% of interest payments to non-residents. The dividends withholding rate is 10%. This should be interpreted that usually the tax authorities expects companies to pay tax on at least 10% of payments abroad on dividends. The royalties withholding tax rate is 25%. This means that the tax authorities expects LLCs to automatically withhold 25% of money remitted abroad on royalties.
There is no known tax on wealth in Honduras. There are no known inheritance taxes in HN. There are real estate and transfer taxes. There are not many popular and well known research and development tax relief in Honduras.
The above is not tax or legal advice for your individual circumstances. We can refer you to a tax advisor in Honduras who can properly advise you. Contact us today. Click incorporate now if you are in a hurry, or press the free consultation button above.
It takes approximately 35 hours to file and prepare documents for a Honduras Civil Law.
The corporate tax is approximately 26.28% which is 126 in the world.
Owners of a company in Honduras are not allowed to carry back a loss and may be allowed to carry forward a loss for 3 years.
The vat rate in Honduras is 15% which ranks 78 in the world.
When looking for a jurisdiction in which to incorporate, the first thing to look at is the legal code. The body of law in Honduras is civil law law. You will want to get some local advice as to how to best structure a company in Honduras. E-signatures are allowed.
The abbreviation HN is for Honduras and the most common legal entity structure in Honduras is a LLC(Sderl).
When setting up, budget about 6 weeks to put together the paperwork and file a LLC(Sderl) in HN. The types of cash you can use to fund your company is often legal currency.
Yes, one is allowed to re-domicile a LLC(Sderl) from HN. You are usually allowed to change the jurisdiction of the company, pending certain procedures.
There must be at least This means it is not possible for you to own a LLC(Sderl) in Honduras as a sole shareholder. You must have other shareholders, they can be nominees or de facto shareholders. Corporate Shareholders are encouraged, which means you can have a corporate shareholder. Foreign ownership is tolerated, up to % of the ownership of the legal entity.
A company is only required to have one director. Furthermore, corporate directors are permitted. Directors data is typically not exposed publicly. There is a body of law which requires companies to hold an annual meetings of shareholders.
However, a company secretary is not always necessary, at least not by law.
There is a requirement to file accounts to relevant authorities. However, there is oftentimes a requirement to have these accounts audited.
Thin capitalization rules are in effect. A company is thinly capitalised when there is a greater proportion of debt than equity. The minimum capitalization for a Honduras Civil Law is 5,000.
A corporate director is permitted, meaning this country is a good option if you are setting up a structure where you want to protect director liability.
The directors are not disclosed in the public registry of Honduras, Chamber of Commerce and Industry. Shareholders are not disclosed in the Chamber of Commerce and Industry.
Typically companies take 6 weeks to setup and there are 1 director(s) required and 2 shareholder(s) required at the time of incorporation.
Overall we think Honduras is a ok option and have given it a score of 56 as an IO score, using the Incorporations.IO proprietary formula.
We can help you form a company in Honduras. Click the button above for a no-obligation quote. We will provide you with all the necessary documents to open a bank account as well as a registered office in Honduras, which is required by law.
| Country | Type | Date signed | |
|---|---|---|---|
| Costa Rica | TIEA | 2006-04-26 | |
| El Salvador | TIEA | 2006-04-25 | |
| Guatemala | TIEA | 2006-04-25 | |
| United States | TIEA | 1990-09-27 |
