Lebanon payroll and tax overview.

Your guide to doing business in Lebanon

Doing Business in Lebanon

Registering A Company and Establishing an Entity In Lebanon

Registrations will depend on the legal form of the establishment. If it is a foreign company they should open a branch or a representation office in Lebanon. They should send the decision by official minutes and it should be legalized. In Lebanon you should appoint a lawyer in order to register the minutes of the ministry of the economy to obtain an authorization and then to be registered at the commercial register and they have to appoint a Lebanese manager for the entity.

After preparing all the necessary documents it normally takes between one week and 10 days to complete the registration process.

The procedure of registering a company is as follows:-

Designate a Lebanese Lawyer

Each newly formed company must retain and pay an attorney on an annual basis.

Deposit the Capital in a Lebanese Bank account

This procedure can be carried out on the basis of a signed (or notarized) copy of the articles of association. This can sometimes take more than 2 days and accrues no charge. For a personal entity or a branch it is not necessary

Register at the Company Registry

The applicant submits the following documents to the company registrar at the Ministry of Justice, along with the total amount of required fees:

  • Articles of association
  • Commercial circulars
  • Minutes of the first general meeting of the partners
  • Registration application and a draft of the registration certificate to be issued
  • Document attesting the capital deposit
  • Partners’ identity cards or passports (copy)
  • Documents evidencing that the company is entitled to occupy the premises where it exercises its activities

Business Banking In Lebanon

It is mandatory to have an in-country bank account to process payroll in Lebanon Banks are open Monday till Friday (8:00am till 4:30pm) and Saturday (8:00am till 1:00pm).

All the banks are closed on Sunday and during official holidays.

Working Week And Working Hours In Lebanon

The typical working week in Lebanon is Monday to Friday from 8am until 5.30pm. Most offices are closed at the weekend.

Basic Facts about Lebanon

General infomation

Full Name: Lebanon Republic

Population: 4,099,000

Capital: Beirut

Major Language: Arabic Major

Religion: Islam and Christianity

Currency: Lebanese Pound

Internet Domain: .lb

International Dialling Code: +961


Hello As-Salām 'Alaykum

Good Morning Ṣabāḥul KẖAyr

Good Evening Masā' Al-Khayr

Do You Speak English? Hal Tatakallam El-Ingliziyya

Good Bye Bāy Bāy

Thank You Shukran

See You Soon Ashoufak 'Ourayyeb

Income Tax & Social Security In Lebanon

Income Tax In Lebanon

The income tax on salaries should be submitted and paid as below;

  • 1st quarter Jan-Feb-Mar: submission and payment before 15 April
  • 2nd quarter Apr- May- Jun: submission and payment before 15 July
  • 3rd quarter Jul- Aug- Sep: submission and payment before 15 October
  • 4th quarter Oct- Nov- Dec: submission and payment before 15 January

Income tax law imposes a tax on all wages, salaries including overtime, gratuities and fringe benefits, after deduction of family allowances. Employers withhold the amounts due from salaries and remit them to tax authorities.

Social Security In Lebanon

Lebanon commits to the principles of equality in rights and obligations and to the improvement of the socio-economic situation, which ensures the rights of its citizens through a comprehensive social approach, endorsed by all the Lebanese, to confirm social security on the basis of justice and equal opportunities.

It is important to understand that it is not an employee‘s responsibility to register with the social securities.

The employer must register all their employees and will deduct the part that should be paid by the employee at source and pay it on his behalf in addition to the rest of the taxes and social security contributions.

The Social Security contribution is as follow:

% paid by the Employee:

For sickness and Maternity (Medical): 2% (ceiling of lbp 2,500,000)

% paid by the Employer:

For sickness and Maternity (Medical):7% (ceiling of lbp 2,500,000) Family Allowances: 6% (ceiling of lbp 1,500,000) End of service Allowance: 8.5% (on the whole salary)

Reporting Tax In Lebanon

Monthly Reporting Social Security for less than 10 employees should be done after each quarter of the year and its related payments should be done before the end of the following quarter. For 10 employees and more, the reporting should be made on monthly basis and its related payments made before the end of the following month. This needs to be paid before the end of next month.

Any delays in the tax or social security payment will be subject to the penalty.

New Employees In Lebanon

New Starts need to be registered within 15 days from the starting date, at the ministry of finance and the social security.

The following registration form should be filled and submitted to the Ministry of finance:

  • R3,
  • R3-1
  • R4

The forms can be found in the company web page or Employment authority’s website.

The documents required for the registration are as follows-

For Single: copy of the ID

For Married: extract from the family civil register, issuance date does not exceed 3 months.

The other details required for the New Starts are –

  • Name
  • Gender
  • Date of Birth
  • Marital Status
  • Number of Children
  • Wife Working or Not
  • BasicSalary
  • Transportation Benefits
  • Medical Insurance

The company must provide payroll authorities with the registrations numbers at the MOF and NSSF.

Leavers In Lebanon Leavers are required to fill and sign the leaver’s form which must be submitted to the ministry of finance R7 at the end of the year, as well as a clearance letter to the Employer.