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How to Incorporate a Business in Honduras: Complete Guide 2026

Last verified: April 2026

Key Takeaways

• Strategic Location: Honduras offers a key strategic location in Central America with access to both the Atlantic and Pacific oceans, making it a logistical hub for regional and international trade.
• Primary Business Structures: The most common business entities for foreign investors are the Sociedad de Responsabilidad Limitada (S. de R.L.), ideal for SMEs, and the Sociedad Anónima (S.A.), suited for larger corporations.
• Favorable Tax System: Honduras operates on a territorial tax system, meaning only income generated within the country is taxed. The corporate income tax (CIT) rate is 25%, with a 5% solidarity surcharge on income over HNL 1 million.
• Investment Incentives: The country offers attractive investment incentives through Free Trade Zones (Zonas Libres - ZIP) and the Temporary Import Regime (RIT), providing significant tax exemptions and customs benefits for export-oriented businesses.
• Streamlined Incorporation: While bureaucratic, the incorporation process is straightforward and can be completed in 4-6 weeks. It involves drafting and notarizing the articles of incorporation, depositing capital, and registering with various government bodies.
• 100% Foreign Ownership: Honduras permits 100% foreign ownership in most sectors, providing a welcoming environment for international entrepreneurs and investors.

Introduction: Why Choose Honduras for Your Business?

Welcome to our comprehensive guide on incorporating a business in Honduras. At Incorporator.io, we provide the expertise and support you need to navigate the Honduran business landscape with confidence.

Honduras, located at the heart of Central America, is increasingly recognized as a strategic destination for foreign investment. Its unique position with coastlines on both the Caribbean Sea and the Pacific Ocean provides unparalleled access to major global shipping routes. This makes it an ideal hub for businesses involved in logistics, distribution, and international trade.

The Honduran government has made significant strides in creating a favorable investment climate. Through a series of legal frameworks and attractive incentive programs, the country actively encourages foreign direct investment, particularly in key sectors such as manufacturing (maquila), tourism, agribusiness, and renewable energy. The local currency is the Honduran Lempira (HNL), but the US dollar is widely used in commercial transactions, simplifying international business operations.

This guide will walk you through every aspect of the incorporation process in Honduras, from choosing the right legal entity to understanding the tax system and ongoing compliance requirements. With our expert insights, you'll be well-equipped to make informed decisions and successfully establish your business in this dynamic and growing market.

Legal Framework & Entity Types in Honduras

Choosing the right legal structure is a critical first step when you decide to incorporate in Honduras. The Honduran Commercial Code outlines several types of legal entities, but two stand out as the most popular choices for foreign investors: the Sociedad de Responsabilidad Limitada (S. de R.L.) and the Sociedad Anónima (S.A.).

Sociedad de Responsabilidad Limitada (S. de R.L.)

The S. de R.L. is a limited liability company, and it is the most common choice for foreign entrepreneurs setting up small to medium-sized enterprises (SMEs) in Honduras. Its popularity stems from its flexibility and relatively simple requirements.

An S. de R.L. requires a minimum of two shareholders and can have a maximum of 25. Shareholders can be of any nationality and are not required to be residents of Honduras. A significant advantage is the low minimum registered capital requirement of just HNL 5,000 (approximately USD 200), which must be fully paid upon incorporation. Management is also flexible and can be handled by one or more managers, who can be shareholders or third parties without any nationality or residency restrictions. Most importantly, the liability of the shareholders is limited to their capital contributions, protecting their personal assets.

Sociedad Anónima (S.A.)

The S.A. is a public limited company, or stock corporation, and is the preferred structure for larger businesses that may want to raise capital from the public in the future. Its key features include:

An S.A. requires a minimum of two shareholders with no maximum limit. These shareholders can be individuals or corporate bodies of any nationality. The minimum registered capital is higher at HNL 25,000 (approximately USD 1,000), with at least 25% of this amount required to be paid in at the time of incorporation. The management structure is more formal, requiring a Board of Directors with at least one member and the appointment of a statutory auditor (comisario) to oversee the company's financial activities. The capital is represented by negotiable shares, which allows for a more straightforward transfer of ownership compared to the participation quotas of an S. de R.L.

Comparison of Honduran Legal Entities

Step-by-Step Incorporation Process in Honduras

The process of Honduras company formation is systematic and involves several key stages. While the timeline can vary, a typical incorporation can be completed within 4 to 6 weeks, provided all documentation is in order. Engaging a local expert, like us at Incorporator.io, can significantly streamline these steps and ensure a smooth process.

Step 1: Draft and Notarize the Articles of Incorporation

The first step is to draft the company’s constitution, known as the articles of incorporation (escritura de constitución). This crucial document must be prepared and signed before a Honduran Notary Public. It will define the company's name, its purpose, duration, capital structure, management, and the names and details of the shareholders. If the shareholders are not physically present to sign, a power of attorney will be required.

Step 2: Deposit the Initial Capital

Before the articles of incorporation can be registered, the initial share capital must be deposited into a corporate bank account in a Honduran bank. The bank will then issue a deposit certificate, which is a mandatory document for the registration process.

Step 3: Register with the Mercantile Registry

Once notarized, the articles of incorporation must be published in the official gazette, La Gaceta, and then registered with the Mercantile Registry (Registro Mercantil), which is located at the local Chamber of Commerce. This is the official step that brings the legal entity into existence.

Step 4: Obtain the Tax Identification Number (RTN)

After registration, the company must apply for its National Tax Registry number (Registro Tributario Nacional - RTN) from the Revenue Administration Service (Servicio de Administración de Rentas - SAR). The RTN is essential for all tax-related matters, including issuing invoices and filing tax returns. It is important to note that the legal representative of the company must be a Honduran national or a foreigner with legal residency to obtain the RTN. [1]

Step 5: Secure Municipal Permits

All businesses in Honduras must obtain an operational permit (permiso de operación) from the municipality where the company will be located. This involves a zoning inspection to ensure that the business activity is permitted at the chosen address. This permit must be renewed annually.

Step 6: Register for Social Security and Other Obligations

Finally, the company must be registered as an employer with the Honduran Social Security Institute (Instituto Hondureño de Seguridad Social - IHSS), the Professional Training Institute (Instituto Nacional de Formación Profesional - INFOP), and the Social Housing Fund (Régimen de Aportaciones Privadas - RAP). This ensures compliance with labor laws and social contributions for all employees.

Costs & Fees for Incorporation in Honduras

Understanding the costs associated with incorporating and maintaining a business in Honduras is crucial for effective financial planning. The following table provides an overview of the typical costs you can expect.

Please note that these are estimates and can vary depending on the complexity of your business structure and the service providers you choose.

Tax Overview in Honduras

Honduras operates on a territorial tax system, which means that only income generated within Honduras is subject to taxation. This can be a significant advantage for international businesses. The main taxes for a corporate entity are the Corporate Income Tax (CIT) and a solidarity surcharge.

The standard Corporate Income Tax (CIT) rate is 25% on net taxable income [2]. In addition to the CIT, companies with a net taxable income exceeding HNL 1 million (approximately USD 40,500) are subject to a Solidarity Contribution, which is a 5% surcharge on the amount exceeding that threshold [2]. This effectively brings the top corporate tax rate to 30% for highly profitable companies.

There is also a Minimum Tax provision. Companies with a gross income of HNL 1 billion or more must pay a minimum tax of 1% of their gross income if their calculated CIT is less than this amount. For certain sectors, such as the production and sale of cement and steel, this rate is reduced to 0.50% [2].

Municipal taxes are also levied on gross annual income, with rates varying by income bracket.

Banking & Financial Infrastructure

Honduras has a developing financial sector with a range of local and international banks. Opening a corporate bank account is a mandatory step in the incorporation process, as you will need it to deposit the initial share capital.

Some of the major banks in Honduras include:

• Banco Atlántida
• BAC Credomatic
• Banco Ficohsa
• Davivienda

While the process of opening a bank account can be bureaucratic, it is generally straightforward with the right documentation. You will typically need to provide the company's articles of incorporation, tax identification number (RTN), and identification documents for the legal representative and shareholders.

Compliance & Ongoing Requirements

Once your company is incorporated in Honduras, you must adhere to several ongoing compliance requirements to maintain your legal standing. These include:

• Annual Tax Filings: All companies must file an annual income tax return with the Revenue Administration Service (SAR).
• Municipal Permit Renewal: The municipal operational permit must be renewed annually.
• Social Security Contributions: As an employer, you must make monthly contributions to the Honduran Social Security Institute (IHSS), the Professional Training Institute (INFOP), and the Social Housing Fund (RAP) for your employees.
• Maintaining Corporate Records: You must maintain proper accounting records and keep the company's corporate books up to date.

Pros and Cons of Incorporating in Honduras

Frequently Asked Questions (FAQ)

Q: Can a foreigner own 100% of a company in Honduras?

A: Yes, Honduras allows 100% foreign ownership of companies in most sectors. The Law for the Promotion and Protection of Investments guarantees national treatment for foreign investors, meaning they are subject to the same rights and obligations as Honduran nationals.

Q: How long does it take to incorporate a company in Honduras?

A: The entire process, from drafting the articles of incorporation to receiving the final operational permits, typically takes between 4 to 6 weeks. This timeline can be affected by the efficiency of government agencies and the completeness of the submitted documentation.

Q: Is a local director required to incorporate in Honduras?

A: No, there is no legal requirement for directors or shareholders to be residents of Honduras. However, for practical purposes, particularly for obtaining the company's tax identification number (RTN), it is often necessary to appoint a local legal representative who is a Honduran national or has legal residency.

Q: What is the minimum capital required to start a business in Honduras?

A: The minimum capital requirement depends on the type of legal entity you choose. For a Sociedad de Responsabilidad Limitada (S. de R.L.), the minimum capital is HNL 5,000 (approximately USD 200). For a Sociedad Anónima (S.A.), the minimum capital is HNL 25,000 (approximately USD 1,000).

Q: What are the main taxes for a company in Honduras?

A: The main taxes for a company in Honduras are the Corporate Income Tax (CIT) at a rate of 25%, a 5% Solidarity Contribution on income over HNL 1 million, and municipal taxes on gross annual income.

Sources

[1] Biz Latin Hub, "Company Formation in Honduras: A Step-by-Step Guide," https://www.bizlatinhub.com/company-formation-honduras/ [2] PwC, "Honduras - Corporate - Taxes on corporate income," https://taxsummaries.pwc.com/honduras/corporate/taxes-on-corporate-income [3] Healy Consultants, "Honduras company setup," https://www.healyconsultants.com/honduras-company-registration/setup-llc/ [4] KPMG, "Investment in Central America: Honduras," https://kpmg.com/content/dam/kpmgsites/pa/pdf/Honduras-EN-Investment-2026.pdf [5] Safeguard Global, "Set Up a Business Entity in Honduras – Complete Guide," https://www.safeguardglobal.com/country/honduras/setting-up-business/