Business in Samoa

This information concerns the independent state of Samoa, not American Samoa. Common business forms include sole trader, partnership, company and overseas company. A company is registered through the Samoa Company Registry and generally needs a physical and postal address, at least one natural-person director, at least one share and at least one shareholder. A Samoa Company Registry account is used for online incorporation, and the registration fee is SAT 250. Sole traders and partnerships do not have a separately evidenced business-name register; tax access uses IR24S for a sole trader and IR24 for a company or partnership, with IR24B used for beneficial ownership information where required. Every business or economic activity needs a Business License before it starts operating. The application goes to Inland Revenue Services. Typical documents include a signed application, a premises map or photographs, proof of financing and, where relevant, a professional certificate. The annual license period runs from 1 January to 31 December. A sole trader or partnership generally pays SAT 282 per activity and location, while a company, joint venture or other listed entity generally pays SAT 640 per activity and location. A special license costs SAT 50 per day. New applications are charged proportionally from approval; renewals are normally made from December through 31 January. A late renewal attracts a SAT 200 penalty. One license is required for each business activity in a partnership or joint venture, and a license cannot be transferred. Closely related activities may qualify for one fee if the Commissioner approves it. The license must be displayed at the premises, and changes to registered information must be reported in writing within 30 days. Cancellation or suspension can follow a breach, with a possible SAT 200 penalty, and a refusal can be appealed in writing to the Minister. A food business needs a Health Certificate under the Food Act 2015. Financial services, telecommunications, gambling and other regulated activities require additional approvals from the relevant sector authority. An overseas company carrying on business in Samoa must register and generally pays a SAT 300 registration fee. Foreign investors need a Foreign Investment Certificate, or FIC, before obtaining a Business License. The FIC application and issue fees are each SAT 50, renewal costs SAT 50 and amendments cost SAT 70. It lasts 12 months, and renewal should be filed at least three months before expiry. It can lapse if the business does not begin within two years. Changes to shareholding, location or activity require notification or amendment. Reserved activities exclude foreign investors, including public buses, taxis, rental vehicles, retail food and drink, saw milling and traditional elei design or printing. Fishing is restricted to a maximum of 40% foreign equity, while some manufacturing and professional activities require a Samoa-incorporated company or local joint venture. A non-Samoan director working in Samoa needs a Work Permit. The Business License creates a unique Taxpayer Identification Number, or TIN, without a separate registration fee. The TIN belongs on invoices, receipts and tax documents. The tax year normally runs from January to December. Individual proprietors are taxed at nil up to SAT 15,000 of taxable income, 20% from SAT 15,001 to SAT 25,000 and 27% above SAT 25,000. Companies pay 27%; a partnership is not itself liable for income tax under the stated Inland Revenue treatment. Value Added Goods and Services Tax, called VAGST, is charged at 15%. Registration is required when turnover exceeds or is expected to exceed SAT 130,000 in a 12-month period, with returns filed every two months. Employers with staff register for PAYE and file a monthly P4 return. The Ministry of Customs and Revenue can designate a business taxpayer for TIMS or EFD obligations at turnover of SAT 200,000, including notice and group requirements. Samoa eTax supports online returns, payments and statements, while account verification typically takes three to five working days. Companies file an Annual Return each year in the month of incorporation. The filing window lasts one month, the fee is SAT 50 and late filing creates an additional fee. The Annual Return confirms register information and is not a substitute for financial statements. Companies must keep a share register with names, addresses, share numbers and transaction dates for seven years. Directors must act in good faith, protect the company’s best interests, control conflicts and exercise care, diligence and skill. The solvency test asks whether assets exceed liabilities and whether debts can be paid when due. When insolvency signs appear, directors must hold a meeting within 10 working days to decide on a liquidator, administrator or continuation. Breaches can lead to penalties, disqualification, claims or personal liability. Development Bank of Samoa, or DBS, offers MSME loans to Samoa nationals, companies and community groups. Foreign investors or entities require verification through the Central Bank of Samoa, MCIL and the Ministry of Revenue. Applicants generally need to be at least 18 and no older than 60. Small loans range from SAT 1,000 to SAT 50,000 with terms of one to five years and listed interest rates of about 8% to 12% per year; medium loans range from SAT 50,001 to SAT 250,000 with terms of five to 15 years. Credit history and security are required, and DBS states that funds are typically made available two to three weeks after an enquiry. Many micro and small enterprises operate informally. Formalisation can improve access to business development services, finance and markets, but the available evidence does not establish a general Business License exemption for informal activity; the specific activity should be checked. Closing a business requires more than allowing its license to expire. The owner or entity submits Business Cessation Form IR27 to Inland Revenue and cancels the TIN within seven days after ending taxpayer status. A company follows the removal process under Part 10 of the Companies Act. If it is not re-registered, assets can transfer to the Crown, while contracts, loans and litigation obligations remain. Restoration costs SAT 300. Insolvent companies use a liquidator or administrator process.