Uzbekistan Info
Joined: 20 Apr 2007
Posts: 14
Home Country: uzbekistan
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 Posted: Thu May 10, 2007 4:58 am Post subject: DOING BUSINESS IN UZBEKISTAN / UZBEKISTAN BUSINESS GUIDE |
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DOING BUSINESS IN UZBEKISTAN
STARTING A BUSINESS
STANDARDIZED COMPANY
Legal Form: Société à Responsabilité Limitée (SARL) - Limited Liability Company
Minimum Capital Requirement: 470,000
City: Tashkent
Registration Requirements:
Procedure 1. Obtain a certificate on the company's name registration.
Time to complete: 3 days
Cost to complete: no charge
Comment: The certificate on the company's name registration is issued by the local statistical authority.
Procedure 2. Notarise the company's founding documents (2 copies of Charter, Article of Association) and lease agreement.
Time to complete: 1 day
Cost to complete: UZS 14100
Comment: Cost is about 40% of the minimum monthly wage. The notary must certify signatures on two sets of the original Charter and the original Founding Agreement. The cost is UZS 940 per signature; UZS 470 per page for notarising a copy of the document.
Procedure 3. Open a temporary bank account with a local bank and transfer 30% of each founder's contribution to the account; pay the registration fee.
Time to complete: 2 days
Cost to complete: no charge
Comment: To open a temporary account, the company needs to submit an application and copies of its founding documents (no notarisation is required) to a local bank. Prior to filing the documents with the local government (khokimiyat) for the company's state registration, each founder must transfer 30% of its contribution in cash to the company's temporary bank account. 20% of the established registration fee must be transferred to the account of the local authority, and 80% must be transferred to the Republican budget. Banking documents confirming that the registration fee has entered the relevant bank accounts must be obtained.
Procedure 4. Register with the local authority (khokimiyat) and obtain the Certificate of State Registration.
Time to complete: 19 days
Cost to complete: 5 times the minimum wages for registration fee
Comment: The following documents must be submitted to the relevant khokimiyat: a standard application form requesting the company's registration, two sets of notarised originals of the charter and the founding Agreement, a document evidencing the company's postal address, banking documents confirming that the registration fee has been deposited in the relevant accounts, a certificate on the company's name registration, three samples of the company's seal and corner stamp as approved at the company's first general meeting, and a banking document confirming that each of the founders has transferred 30% of its contribution. Upon in maximum the 30th day after submission of the relevant documents the khokimiyat must issue a certificate confirming the company's state registration, and must provide the company with the latter's founding documents where a stamp "Registered" and a state stamp must be affixed, and also with a permit to make a seal and a corner stamp.
To perform one-stop shop registration the khokimiyat shall:
(1) register the company with tax, social security and statistic authorities;
(2) obtain a permit to make a seal from local bodies for internal affairs;
(3) register the lease agreement with the local cadastre services;
(4) obtain permits for the company to use utilities;
(5) issue a certificate confirming the company's state registration;
(6) put a stamp "Registered" the state seal on company's original founding;
(7) deliver to the company all permits obtained for the company to start-up operations (mentioned above)
Upon the issuance of the certificate on company's official registration, the registering agency shall release to the company a set of original Charter and Foundation Agreement with a registration note on the title page, and all registration documents and permits made within the "one-stop shop" filings.
Time to complete is from 7 days to 1 month depending on how complicated the registration documents are. According to the Resolution # 357 dated 20 August 2003 the registration of a LLC shall be done within 7 working days; after 3 days of submission of an application for registration, the local khokimiyat should disclose any non-compliance, and then proceed further with one-stop registration process of the company.
Procedure 5. Make a company seal.
Time to complete: 1 day
Cost to complete: UZS 11000 to 18 000
Comment: The company's seal must be made by a specialised company that renders payable services for making seals.
Procedure 6. Notarise specimens of signatures of the company's general director and chief accountant, as well as a sample of the company's seal print.
Time to complete: 1 day
Cost to complete: UZS 940 per signature (10% of minimum monthly wage), assuming 10 signatures
Comment: To open a permanent bank account, three cards for specimens of signatures must be obtained from the bank and filled in by both the company's general director and the chief accountant in the presence of a notary. Signatures made on three completed cards and two samples of the company's seal print must be certified by the notary.
Procedure 7. Open a permanent bank account with a local bank.
Time to complete: 1 day
Cost to complete: no charge or up to 1 minimum monthly wage
Comment: To open any permanent bank account, the company must submit to the relevant bank an application specifying the company's address and the types of accounts to be opened, a copy of the certificate of registration, and the notarised specimens of signatures and the notarised samples of the company's seal print.
Procedure 8. Register for the social insurance.
Time to complete: 1 day
Cost to complete: no charge
FORMS OF BUSINESS ORGANISATION
1. Joint stock company
2. Limited liability company
3. Partnership
Branches are not widely used by foreign companies to conduct business in Uzbekistan.
Foreign companies that establish a local entity in the form of a joint venture or wholly owned subsidiary must be registered with the Ministry of Justice and the Ministry of Labour.
TAXATION
Corporate tax
Main rate: 12%
Resident companies are taxed on their worldwide income; non-resident companies are taxed only on income sourced in Uzbekistan. A company is resident if established or registered in Uzbekistan, or if the main enterprise is located in Uzbekistan.
Legal entities may opt to be subject to Unified Income Tax (if the legal entity is treated as a micro- or medium-sized enterprise under Uzbek law) at a rate of 12%. The flat tax rate is linked to revenue. The advantage of unified tax is that the legal entity is not required to pay other taxes such as infrastructure tax, property tax, land tax, VAT, Road Fund, etc.
Individual tax
Progressive rates to 29%
Residents are taxed on their worldwide income; non-residents are taxed only on income sourced in Uzbekistan. A person permanently residing in Uzbekistan or staying for 183 days in any 12-month period starting or ending in a particular fiscal year is considered a resident for tax purposes in that fiscal year. Individual income tax is charged at progressive rates from 13% to 29%.
Capital gains
Taxed as income
Capital gains are included in income.
Indirect tax
VAT standard rate: 20%
The 20% standard rate of value-added tax (VAT) applies to most transactions. Exports and certain agricultural inputs such as fertilisers, fuel and lubricants are zero-rated. Exemptions include financial services, public utilities, municipal passenger transport and public education services. Legal entities operating under the unified tax are not required to charge/offset VAT charges.
Tax administration and compliance
Tax year: Calendar year
Legal entities must file quarterly and annual tax returns and self-assess the tax due, which must be paid within five days after submitting the return. Employment income is taxed by withholding. Individuals with other sources of income must file a tax return by April 1st following the end of the tax year.
Additional tax information
Withholding taxes: Dividends and Interest 10%, Royalties 20%. The withholding tax rates may be reduced under the provisions of an applicable tax treaty.
Tax treaties: Uzbekistan has concluded more than 40 tax treaties.
Dividends: Dividends received by legal entities and individuals from domestic companies are subject to a 15% final withholding tax.
Revenue protection: There are transfer-pricing provisions but no CFC rules.
Groups: There is no provision for group taxation.
Incentives: Exports; manufacturing in certain regions of the country; certain industry-based incentives; investment amount, etc.
Other taxes: Customs and excise duties, Ecology tax, Infrastructure tax, Land tax, Property tax, Subsurface use tax, Unified social tax, Water use tax. |
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