A single-member LLC is a limited liability company with only one owner. LLCs are commercial companies that offer owners personal liability protection, defending their personal property—such as a house or car—against lawsuits brought against the company. Single-member LLCs share several characteristics with another sort of business entity, the sole proprietorship. Sole proprietorships are run by a single person, just like single-member LLCs. Both are automatically taxed in the same way, although single-member LLC owners have more alternatives for how to handle their tax payments.
A single-shareholder LLC has a legal personality that can be renewed indefinitely and has a period of 25 years starting from the day it was granted. The articles of organization, commercial registration, and tax card serve as the governing documents for a single-shareholder LLC. Only the company’s assets are subject to liability. The business can take part in cross-border mergers, asset purchases, stock purchases, and other international transactions and restructurings. A single-shareholder LLC cannot be listed on a public exchange. General authority for investments and free zones (GAFI) and commercial registration are the regulatory organizations in Egypt for single-shareholder LLCs.
Single-shareholder LLC registration in Egypt
A single-shareholder LLC requires a minimum share capital of 50,000 EGP, which must be paid in full at the time of incorporation. The registration procedure entails:
Certificate of Trade Name Clearance
This process takes a day and costs nothing at all: The commercial Registry will issue certificates using the new CRA method. The present CRA method doesn’t reserve the business name you want; it just determines whether it is available.
Get a certificate from a bank that is approved
It costs EGP 300 and takes a day to accomplish. The certificate is issued and delivered in 1-2 days by the bank of Alexandria branch at the Central Authority for Free Zones and Investment (GAFI).
Submit documentation to the establishment department of the company, under GAFI
In just one day, this is finished. A lawyer quickly reviews the supplied documents. The following papers need to be examined:
- certificate of clearance for a trading name
- A founder ID
- Application to GAFI
Notarize the business contract
It takes a day to do this. Capital expenditure is 0.25 percent. After a second inspection of the documents, including the power of attorney, a public notary notarizes the articles of association.
Get a certificate from the chamber of commerce (done by GAFI)
This takes a day to complete and costs 0.2% of capital. Due to the company’s compliance with Law 159, a GAFI employee would get the chamber of commerce certificate on the client’s behalf and present it to the client.
Release of the Incorporation Notification (done by GAFI)
The responsible authority approves the already-submitted articles of association, and this authority then issues a decree approving the company’s incorporation.
Register for taxes
After incorporation, the business can complete tax registration and get a tax card at the tax counter of the One-stop shop. Only after reaching EGP 54,000 in sales for industrial operations and EGP 150,000 in sales for commercial activities are businesses need to register for sales tax. The necessary records consist of:
- the association’s bylaws
- the legal authority
- The bank signature confirmation goes to the company’s authorized signer
- a tax card
- a certified original extract from the business’s commercial registration
- the original copy of the lease for the business’s property
Employers should register with the national authority for social insurance
Social insurance offers benefits for accidents sustained at work, disability, retirement (pension), and unemployment. A social insurance ID number that is exclusive is provided by the National Authority of Social Insurance. The employer must deliver the following paperwork to the office of the competent authority, along with a fully filled-out application (Nos. 1 and 2) that was authorized by that authority:
- Lease for business space from the employer
- card for employer’s taxes
- Copy of the employer’s birth certificate and identification card
- The employee’s and the employer’s diplomas
- a document issued by a commercial Registry
