Starting or running a business in Sri Lanka can raise many questions. At Wijesinghe Chambers, we often hear the same concerns from entrepreneurs and investors. To make things simpler, we have put together the most common questions and clear answers to help you navigate the legal side of business with confidence.
1. Can foreigners start a business in Sri Lanka?
Yes. Foreigners can start businesses, usually by registering a Private Limited Company. There are some restrictions on owning land and operating in certain sectors, so it is important to check the rules for your specific business. We help foreign investors understand these requirements and guide them through approvals when needed.
2. How long does it take to register a company?
If all your documents are complete and correct, incorporation typically takes about two to three weeks. Name approval usually takes two to three working days. Our team ensures all paperwork is done correctly to avoid delays.
3. What type of business structure should I choose?
The choice depends on your goals, the size of your business, and your risk tolerance. Many entrepreneurs choose a Private Limited Company for credibility and limited liability. Sole proprietorships and partnerships are simpler but expose owners to personal liability. We advise clients on the structure that best fits their needs.
4. How many directors are required for a company?
A Private Limited Company needs at least one director. At least one director must reside in Sri Lanka. We help you appoint directors correctly to meet legal requirements.
5. Do I need a company secretary?
Yes. Every company must have a qualified secretary at the time of incorporation. The secretary ensures the company complies with the Companies Act and helps maintain proper records. We provide guidance on selecting and appointing the right secretary.
6. What taxes do I need to register for?
Every company must register with the Inland Revenue Department to obtain a Tax Identification Number. Depending on your business, you may also need to register for Value Added Tax or other tax schemes. We guide clients through this process to ensure full compliance from the start.
7. Are special licenses required for certain businesses?
Yes. Some industries require additional approvals. For example:
- Tourism businesses must register with the Tourism Development Authority.
- Importers and exporters need customs approval.
- Restaurants and food businesses must comply with health regulations.
We help clients identify and obtain all the licenses they need to operate legally.
8. What are the ongoing compliance requirements for a company?
Once your business is running, you must file annual returns, prepare audited financial statements, and notify authorities of any changes in directors, shareholders, or office address. Staying compliant can be complex, but we assist our clients at every step so compliance is never a burden.
9. Can I open a corporate bank account immediately after registration?
Yes, but the bank will require certain documents, including your Certificate of Incorporation, Articles of Association, and a board resolution approving the account. Foreign investors may also need Central Bank approval for capital transfers. We guide clients through this process to avoid delays.
10. How do I ensure my business remains legally safe as it grows?
Ongoing legal support is key. This includes keeping corporate records up to date, renewing licenses, filing tax returns, and making sure employment and labour laws are followed. Wijesinghe Chambers works closely with businesses to provide ongoing support, allowing owners to focus on growth with peace of mind.
Final Thoughts
Running a business in Sri Lanka does not have to be overwhelming. The legal landscape can be managed effectively with the right guidance. At Wijesinghe Chambers, we help entrepreneurs and investors from start to finish. Our goal is to make the legal side simple so you can focus on building your business confidently.