Company Formation in Lesotho

General reference only. This skill is general tax/accounting reference material for AI-assisted workflows. It has not been reviewed for any specific person's facts, documents, elections, deadlines, residency, filing status, or local procedures. Do not rely on it to file, pay, amend, or take a tax position without review by a qualified professional in the relevant jurisdiction.

Who this applies to

Founders and foreign companies setting up in Lesotho. Companies register under the Companies Act No. 18 of 2011 at the One-Stop Business Facilitation Centre (OBFC). Types: public, private and non-profit companies, plus external companies. A sole trader is taxed in the owner's hands.

Lesotho's tax year runs 1 April to 31 March. This skill covers 2026-27, from 1 April 2026.

Rates, bands and thresholds

Item	Figure	Conditions	Official URL
Name reservation	M30	Internal or external company	https://lndc.org.ls/knowledge-base/business-registration-and-licensing/
Internal company application	M500		https://lndc.org.ls/knowledge-base/business-registration-and-licensing/
External company application	M1,000	The page labels this row oddly; confirm on filing	https://lndc.org.ls/knowledge-base/business-registration-and-licensing/
Trading licence	M500 to M50,000 (MSME); M1,500 to M150,000 (large)	Risk-based; for negative-listed activities; annual renewal	https://lndc.org.ls/knowledge-base/business-registration-and-licensing/
Manufacturing licence	M150 small; M3,500 medium to large	M1,000 late renewal	https://lndc.org.ls/knowledge-base/business-registration-and-licensing/
Business ID	Renewed every 3 years		https://lndc.org.ls/knowledge-base/business-registration-and-licensing/
VAT registration	M2,000,000 a year	See ls-vat-gst	https://www.rsl.org.ls/sites/default/files/2026-09/Guide%20on%20Registration%20For%20Value%20Added%20Tax%20Purposes%20%20-%20VAT%20101%20%281%29.pdf
Minimum share capital	unverified	Older skill: none. Companies Act not read	unverified: not opened
Minimum shareholders and directors	unverified	Older skill: one of each. Companies Act not read	unverified: not opened

The base

Steps: (1) create an account on the companies registry; (2) get authority to file (directors, or an authorised agent); (3) search and reserve the name; (4) choose the company type; (5) submit online with articles, director consents, application form, shareholder list and certified IDs (external companies also a foreign certificate of incorporation); (6) pay by EFT and send proof to the OBFC; (7) RSL and the OBFC assess the application jointly. Then register for tax and, if needed, VAT, and get any licence. A private company restricts share transfers and a public company may offer shares to the public, per the older skill (Companies Act not read).

Deadlines and filing

• Annual return to the Registrar: required per the older skill; date and fee unverified.
• Trading licence: renew yearly and display at the premises.
• Manufacturing licence: renew yearly under 50 employees; above 50, it expires 31 December.
• Accounting records and annual financial statements: required per the older skill; audit thresholds unverified.
• Incorporation time: the LNDC page gives none, and the older skill's estimate of days to weeks is unverified.

Penalties and interest

Not stated on the page read. See ls-income-tax and ls-vat-gst for tax penalties.

Cross-border points

LNDC classes a company owned 100% by local shareholders as internal and one owned 100% by foreign shareholders as external. Shareholders can be people or companies. An external company files with its foreign certificate of incorporation. A Lesotho branch of a non-resident company pays 25% on repatriated income as well as income tax (see ls-corporate-income-tax). Unverified: how mixed ownership is classed, and whether an external company is taxed as a branch; the Companies Act was not read.

Two worked examples that recompute

Example 1: internal company fees M30 plus M500 is M530, before any licence.

name: Internal company fees
inputs:
  name: 30
  application: 500
steps:
  - total: name + application
expected:
  total: 530.00

Example 2, a decision: an external company costs M500 more in fees than a local one: M1,030 against M530.

name: External against internal
inputs:
  internal: 530
  external: 1030
steps:
  - extra: external - internal
expected:
  extra: 500.00

Ask the client first

1. Local company, external company or sole trader?
2. Activity: is it negative-listed or manufacturing?
3. Who are the directors and shareholders?
4. Expected taxable turnover?
5. Staff numbers?

Sources

Source	URL	Read on
LNDC Business Registration and Licensing page; read in full	https://lndc.org.ls/knowledge-base/business-registration-and-licensing/	2026-11-01
RSL Guide on Registration for VAT, VAT 101; read in full	https://www.rsl.org.ls/sites/default/files/2026-09/Guide%20on%20Registration%20For%20Value%20Added%20Tax%20Purposes%20%20-%20VAT%20101%20%281%29.pdf	2026-11-01

Not yet confirmed: everything resting on the Companies Act 2011 and Companies Regulations 2012 (share capital, member and director minimums, annual return, audit, business names): msm.org.ls failed its security certificate and lesotholii.org showed a security check, so neither was read; OBFC site did not load.