Honduras

Registrations and Establishing an Entity

• Incorporation via Public Deed by a notary, stating name, activity, domicile, capital
• Requires partner documents, solvency certificates, RTN registration
• Commercial Registry filing is mandatory
• Process duration: approx. 2 business days

Banking

• An in-country bank account is mandatory to operate a business or process payroll

Working Week

• Max 44 hours/week
• Standard: 8 hours/day; overtime not to exceed 12 hours/week

Holiday Accrual

• 1 year: 10 days
• 2 years: 12 days
• 3 years: 15 days
• 4+ years: 20 days

Maternity Leave

• 4 weeks before + 6 weeks after childbirth (10 weeks total)
• Full pay based on prior year average or full employment period if shorter
• Job protection and rights retention guaranteed

Paternity Leave

• No statutory entitlement

Sick Leave

• 3–6 months service: 1 month at 50% pay
• 6–9 months: 2 months at 50%
• 9+ months: 3 months at 50%
• 5+ years: 30 days/year at full pay

National Service

• Not mandatory

Tax Year

January 1 – December 31

Income Tax

• 0–209,369.62 HNL: 0%
• 209,369.63–319,251.54 HNL: 15%
• 319,251.55–742,445.49 HNL: 20%
• 742,445.50+ HNL: 25%
• Corporate tax: 25%

Social Security Contributions Employee:

• RAP: 1.5%
• IHSS: 2.5%
• Welfare Insurance: 2.5%

Employer:

• RAP: 1.5%
• IHSS: 5%
• Labor Coverage Insurance: 4%
• INFOP: 1%
• Welfare Insurance: 3.5%

Reporting

• Contributions due within 10 days of month-end

Payroll

• Monthly wages paid in legal tender at the workplace
• Barter permitted for rural workers up to 30% of pay
• Online payslips allowed if secure
• 13th salary paid in December, 14th in June

Reports

• Must be retained for 7 years

New Employees

• Register with IHSS, apply for IHSS card
• Provide contribution form, pay fees, validate employee

Leavers

• Notice and final payment required
• Severance based on tenure:
  • 3–6 months: 10 days
  • 6–12 months: 20 days
  • 1+ year: 1 month/year (max 8 months)

Employee Benefits

• Christmas (13th) and June (14th) bonuses
• Unused vacation and proportional bonuses paid at exit

Expenses

• Executives may negotiate additional benefits

Foreign Workers

• Must meet 90% local staff and 85% wage share rule
• Residence permit required for >3-month contracts
• Valid up to 5 years

Required:

• Passport, medical and criminal records
• Authenticated work contract
• Employer declarations and proof of solvency
• Official translations for all foreign documents

• Legal documents must be notarized and often officially translated
• Taxpayer RTN and municipal solvency required
• Barter permissible for agricultural labor compensation

Further Information For more information, or assistance with Honduras tax enquiries please contact: gi@activpayroll.com

About This Payroll and Tax Overview Please note that this document gives general guidance only and should not be regarded as an authoritative or complete statement of the law, regulations or tax position in any country. You should always seek specific advice for each specific situation. This document should not be relied upon as professional advice and activpayroll accepts no liability for reliance on its contents.