Working in SA – temporary business permit

What permit is needed to set up a business in SA?

We are 4 Israelis that would like to set a new small cosmetics business in SA. We need someone to help us with all the needs from A to Z If it for the company and if it for in the immigration, work permit, etc

Chris Watters replies:

As regards the immigration issue, I advise as follows:

1. If a person is going to either start or invest in, a business (which may or may not also employ that person), he will need what is called a temporary business permit to operate the business in South Africa. The permit that is issued, is authority to you and not to the business. This does mean that if your partners will be co-owners of the business (an “owner” is a person with a stake of or in excess of 25%), they have to go through the same process and get the same permit.

2. The key requirements for a business permit (there are others, obviously) are-

a. that you have a comprehensive business plan setting out the company’s prospects in the short and long term;

b. that a South African chartered accountant verifies your projected cash flow figures and funds available for investment in the business;

c. that you have an amount of R2,5 million Rand available offshore for investment in the business (or have already invested). If you do not have that amount, that the amount you do have available for investment (and/or have already invested) in the business, such lower figure must be been approved by the Department of Trade and Industry which must also first issue a recommendation in respect of your proposed business before the whole application gets presented to Home Affairs for adjudication.

3. It takes on average about 6 – 7 months to get a business permit from the start of the instruction if the client gives the matter serious attention.

4. These permits are issued for two years at a time and accompanying immediate family obtain appropriate permits to accompany the holder of the business permit – but these are not to work in the business.

5. Once (or assuming) that temporary business permit has been issued to you, you would then be entitled to apply for permanent residence – in the self–employment category.

6. You are allowed to register the company and to attend to necessary start up arrangements without first having this permit – but you cannot run / operate the company without getting the business permit.

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