The subsidiary: a separate Tunisian company
The subsidiary is a Tunisian-law company, usually a SARL or an SA, with its own legal personality. The parent's liability is limited to its contribution. The subsidiary is tax resident in Tunisia and its dividends are subject to withholding tax, subject to the applicable tax treaty.
It reassures banks, customers and authorities, lends itself to local partnerships and may, depending on the activity, qualify for the fully exporting regime.
The branch: an establishment of the foreign company
The branch has no separate legal personality: it is the foreign company itself that operates in Tunisia and answers for its commitments. It is registered with the national business register, keeps accounts in Tunisia and is taxed there on the profits of its Tunisian activity.
Lighter to set up, with no share capital or corporate bodies of its own, it does however expose the parent directly and requires the parent's corporate documents to be produced, translated where needed.
The criteria for choosing
Duration and nature of the project, time-limited assignment or permanent business; risk exposure; target tax regime; treatment of transferred profits under the tax treaty between Tunisia and the parent's country; customer or public-procurement requirements; group reporting constraints.
In both cases, the funds provided by the parent must be imported in foreign currency through a bank so that capital and profits remain transferable.
How we help
Tax and legal trade-off, incorporation, intra-group agreements, Tunisian-GAAP accounting with reporting to group standards, local payroll and audit. The starting point is the online diagnostic: choose 'A foreign company', and a chartered accountant from the firm calls you back within one business day.
Frequently asked questions
What is the tax difference between a subsidiary and a branch?
Both are taxed in Tunisia on the profits of the Tunisian activity. The difference lies mainly in the treatment of profits transferred to the parent and in how the tax treaty between the two countries applies, which we analyse for your case.
Which parent-company documents are needed?
Its articles, a recent extract of its registration and the decision of its governing bodies creating the subsidiary or branch and appointing its representative, translated where needed and legalised or apostilled.
Is a statutory auditor required?
It is mandatory for a subsidiary formed as an SA. For a SARL, the requirement depends on thresholds set by law; for a branch, we check the applicable requirements and those of your group.
Can a branch be turned into a subsidiary?
In practice, this means creating the subsidiary and transferring the business to it, with tax consequences to plan for. It is better to choose the right structure from the start.
Where do I start?
With the online diagnostic: four questions, including one on capital held by a foreign company. A chartered accountant from the firm, registered with the OECT, then takes over your file within one business day.