silo_m8
I have an idea of a shop that I want to invest in, a sort of arcade and I have no idea what are the legal requirements for it.
I'm talking about taxes and the like. I want to make a serious assessment of legal fees and possible profitability and return on investment before actually investing.
Does anyone know what the process is? The more detailed, the better.
Nb: tried googling it but I suck at Arabic searches
NuclearVision
People open and close phone shops all the time, no one complains.
Is it legal? I don't know, but who cares?
My thoughts: Opening a shop is tax free, except for annual municipality/other fees for the shop as an estate if you own it.
But when you have to pay tax? It is when you have a registered firm.(مؤسسة(
I could be wrong.
silo_m8
NuclearVision wrotePeople open and close phone shops all the time, no one complains.
Is it legal? I don't know, but who cares?
My thoughts: Opening a shop is tax free, except for annual municipality/other fees for the shop as an estate if you own it.
But when you have to pay tax? It is when you have a registered firm.(مؤسسة(
I could be wrong.
The reason I wanna make sure it's legal is because I will be competing with another shop and I'm afraid of him being dirty in his competition so making sure that everything is legal is my safety sheild
Elied
Even if everything is legal with the right connections anything can be done here in Lebanon. So if you suspect that your competition is well connected and is willing to play very dirty then honestly that's not a wise investment to make. The profit isn't worth the headache it causes.
tech-guru
In My previous work as a Senior Consultant of Commercial , Investment , and Economic Affairs in the Malaysian Embassy I guided many to open here , an commercial entity (to be legal) shop or a company (which are a business entity) need core set of procedures:
Designate a Lebanese lawyer
Deposit the capital in a bank
Register at the Company Registry ( Commercial Register )
Notify the Ministry of Finance of commencement of business operations
Register at the National Social Security Fund (NSSF) , more than 10 employees you need a representative
Register for VAT
A lawyer usually will track all the process and connection with the Lebanese governmental entities and what is required as paper process and hiring a good senior accountant that knows about NSSF , Ministry of Finance forms submission , declarations , deadline is crucial since it is a complete cycle from journal entries and Lebanese Chart of accounts to financial statements.
Usually Lebanese Firms / some shops go in the "risky shadows" by creating double accounts - one black for the actual expenses expenditures and one white that increase the expenditures thus decreasing the net come = paying less for the MoF (10% on Net Prodit Yearly) , also declaring the minimum wage for NSSF (currently 675,000 LL) to pay less for the NSSF (23.5 % , 8.5% & End of Service , 6% Family allowance , and 9 % ( 7 % on the Company and 2 % on the employee ) for Health Allowance). Some small shops also do not declare any thing to the MoF or NSSF in both , no declaration or jeopardized numbers will lead for legal track to the company/shop by the MoF and NSSF Detectives - penalizing and closure.
Importing from Outside has it Laws, Procedures , and Rates from the Lebanese Customs.
silo_m8
Tech Guru wroteIn My previous work as a Senior Consultant of Commercial , Investment , and Economic Affairs in the Malaysian Embassy I guided many to open here , an commercial entity (to be legal) shop or a company (which are a business entity) need core set of procedures:
Designate a Lebanese lawyer
Deposit the capital in a bank
Register at the Company Registry ( Commercial Register )
Notify the Ministry of Finance of commencement of business operations
Register at the National Social Security Fund (NSSF) , more than 10 employees you need a representative
Register for VAT
A lawyer usually will track all the process and connection with the Lebanese governmental entities and what is required as paper process and hiring a good senior accountant that knows about NSSF , Ministry of Finance forms submission , declarations , deadline is crucial since it is a complete cycle from journal entries and Lebanese Chart of accounts to financial statements.
Usually Lebanese Firms / some shops go in the "risky shadows" by creating double accounts - one black for the actual expenses expenditures and one white that increase the expenditures ti increase the net come thus paying less for the MoF (10% on Net Prodit Yearly) , also declaring the minimum wage for NSSF (currently 675,000 LL) to pay less for the NSSF (23.5 % , 8.5% & End of Service , 6% Family allowance , and 9 % ( 7 % on the Company and 2 % on the employee ) for Health Allowance). Some small shops also do not declare any thing to the MoF or NSSF in both , no declaration or jeopardized numbers will lead for legal track to the company/shop by the MoF and NSSF Detectives - penalizing and closure.
Importing from Outside has it Laws, Procedures , and Rates from the Lebanese Customs.
Thanks a lot for this info.
I guess in the time being even though I'm not planning to hire anyone, as a side job, it would be too much risk versus the possible reward.
Thanks again
NuclearVision
Take the following as an advice.
I second elied, if other shop has been there for long, and if you are "foreigner to the town", You'll be facing serious problems, not precisely legal.
However, good people still exist, and he might be annoyed but treat the situation wisely.
dsoftware-king
I can give you a detailed explanation later when I have time,
but first let me ask you this: do you have an idea what is the legal form of the shop you want to open? (sole proprietorship of limited liabilty company)
dsoftware-king
sole proprietorship: you are responsible for the entity liabilites by your own money. tax rate: Intervals
Limited Liability company: you are only responisble only for the stake you own in the capital, however it requires at least 3 persons to form this kind of company. it requires appointing a lawyer and an auditor. tax rate: 15% on profits (there are some special taxes which I can be discussed based on the type of business you have)
silo_m8
dsoftware.king wrotesole proprietorship: you are responsible for the entity liabilites by your own money. tax rate: Intervals
Limited Liability company: you are only responisble only for the stake you own in the capital, however it requires at least 3 persons to form this kind of company. it requires appointing a lawyer and an auditor. tax rate: 15% on profits (there are some special taxes which I can be discussed based on the type of business you have)
I will be a sole proprietor.
dsoftware-king
silo_m8 wrotedsoftware.king wrotesole proprietorship: you are responsible for the entity liabilites by your own money. tax rate: Intervals
Limited Liability company: you are only responisble only for the stake you own in the capital, however it requires at least 3 persons to form this kind of company. it requires appointing a lawyer and an auditor. tax rate: 15% on profits (there are some special taxes which I can be discussed based on the type of business you have)
I will be a sole proprietor.
are you willing to import anything from abroad? or export?
silo_m8
dsoftware.king wrotesilo_m8 wrotedsoftware.king wrotesole proprietorship: you are responsible for the entity liabilites by your own money. tax rate: Intervals
Limited Liability company: you are only responisble only for the stake you own in the capital, however it requires at least 3 persons to form this kind of company. it requires appointing a lawyer and an auditor. tax rate: 15% on profits (there are some special taxes which I can be discussed based on the type of business you have)
I will be a sole proprietor.
are you willing to import anything from abroad? or export?
It's an arcade, i will be selling services or renting equipment out, which ever way you put it.
No import/export/selling of products
dsoftware-king
you don't need a lawyer, you need an accountant to handle your book keeping and tax declarations.
Sole proprietorship would be fine with you, Tax brackets are as follows:
4% from 0-9M
7% from 9-24M
12% from 24-54M and so on
you get a 7.5M deduction on yourself and 2.5M on your wife and 0.5M on each get (up to 5) for the purpose of calculating tax due on profits.
if you are planning to hire someone then you should register with NSSF and pay subscriptions 23.5% where your entity bares 21.5% in addition for the responsibilty to file for salaries tax.
if you don't have an accountant that you trust let me know.
dsoftware-king
also, you have to be aware that if you hit the 150M threshold in revenues you will have to register with the VAT Agency and file accordingly.
user
When you say 150M you mean per month or per year? Also hiring accountants needs to be a full time accountant or can it be an accountant that just checks in weekly and updates some sort of ledger?
Now I'm curious, if his idea works, I want to try an arcade in my area.
dsoftware-king
150M per year.
as far as I can see it, you don't need a full time accountant. you need someone to set things up right. routine visits, count depends on work load.
setting things up from startup is the most important thing.