Business in Sri Lanka takes an active position in the economic market on the island. After the end of hostilities, large investments began to take place here.
From this point until 2021, the positions of entrepreneurs have grown by 20%. This suggests that there are still plenty of opportunities in the country for running a lucrative personal business.
Benefits of starting a business in Sri Lanka in 2021
Over the past decade, the number of startups involved in starting a business and proposing new ideas has increased significantly. Despite a sufficient number of competitors, law firms exist and generate good income.
With such prospects, businessmen are advised to apply for a resident visa.
Investing in your own business in Sri Lanka has the following advantages:
- state support in the first steps;
- you can use any amount of the authorized capital;
- ease of obtaining a loan;
- the inability to duplicate the name of the company by other participants;
- companies are being identified and recognized.
To register a business on the island, it is necessary to choose the type of property so that income and tax are optimal.
Business options in Sri Lanka for foreign citizens
Before you start organizing business plans with their further implementation on the island, you need to get skills in this matter. Marketing, PR, financing, and accounting are considered profitable and in-demand niches.
Accordingly, it is easy to gain experience in these areas. The hotel and restaurant business is actively developing in Sri Lanka. This is where your funding skills come in handy.
Popular industries in Sri Lanka
Along with the development of hotels and restaurants, it is allowed to gradually contribute to the existence of personal building companies. In the future, such companies can function in an integrated manner and provide a whole package of services during their work. In aggregate, a residence permit is also required.
Business with the organization of family hotels has an advantage. Such establishments require large investments, over 50 thousand dollars, while the development of construction companies requires investments in the amount of 2.5 million dollars.
Algorithm for preparing documents
To do your own business in Asia, you need to be able to correctly approach the design and preparation of documentation for registration.
First of all, a personal account of the company is opened in a bank in Sri Lanka, where on the same day part of the amount is transferred for business development. Further use of a bank account in Sri Lanka is permissible for the withdrawal of profits or refusal of investments.
Then the company is split up. Here you need to choose the method of registration of shares of the enterprise. Often the company is registered in 100% of the volume per owner. In the early stages, this method is considered rational. It is also allowed to choose a founder with a 60% share of the registered business given to him.
It remains to obtain a visa to Sri Lanka. To do this, you will need to obtain permission from the investment object. This is both a long-existing institution and a recently created one. Also, you need to demand a letter from the bank that confirms the seriousness of intentions, the presence of an account, and the specific amount of the deposit on it.
Business taxation in Sri Lanka
For each profitable enterprise that is registered in the country, you need to pay VAT to the local tax office. Tax collection in the state is carried out strictly from April 1 to March 31. Time of payment of debts for the year before September 30. There are several types of business taxes:
Corporate income. The VAT rate is 28%, sometimes a payment option from 10 to 40% can be considered.
Translation tax. Tax transfers to the authorized capital from a foreign state in the amount of 10% or more.
Income. If the firm has an income of fewer than 5 million rupees per year, then the tax rate will be 16%. If the indicator is greater than or equal, then the amount of VAT increases to 35%.