Do I Need a Local Entity to Hire in Botswana?

In Botswana, a "local entity" refers to a recognized business presence that can act as an employer, typically a subsidiary or branch office. This setup enables you (or a provider acting on your behalf) to be recognized locally and fulfill payroll and employment obligations.

Without a local entity, you generally can't register as an employer, manage mandatory tax processes, or run compliant payroll. However, an Employer of Record (EOR) can help you navigate these requirements without the need for a local entity.

What is Required to Employ Someone in Botswana?

• Local employing entity required to directly employ? Usually yes (unless using an EOR)
• Payroll registration required? Yes (employer registration with the Botswana Unified Revenue Service)
• Withholding/tax remittance required? Yes (mandatory income tax withholding applies)
• Social contributions required? Yes (employer must contribute to the Social Security Fund)
• Local employment agreement required? Yes (written contracts are standard practice)
• Mandatory benefits to budget? Yes (includes annual leave, sick leave, and maternity leave)
• Works council/collective agreements considerations? Not common (generally not applicable in Botswana)

Best Options If You're Hiring in Botswana

Can I Hire Contractors Instead of Setting Up an Entity?

Yes, but you should be cautious about misclassification risks.

While hiring contractors in Botswana doesn’t require a local entity, it’s essential to ensure that the contractor operates independently. Misclassification can lead to legal issues if the contractor is deemed to be functioning like an employee.

• Ensure the contractor has multiple clients and isn’t exclusively working for you.
• Limit your control over how the work is done to maintain independence.
• Consider the nature of the work and relationship to avoid legal pitfalls.

How Long Does Entity Setup Take And What Does It Cost?

Typical entity setup timeline: It often takes 4–6 weeks to set up an entity in Botswana, depending on required registrations.

Ongoing cost categories (entity route):

• Accounting, bookkeeping, and statutory filings: Estimated BWP 2,000–5,000 per month ($150–$375)
• Payroll provider: Estimated BWP 500–1,500 per employee per month ($38–$113)
• Employer registrations and recurring compliance: Varies by complexity
• Corporate tax filings and annual reporting: Estimated BWP 10,000–20,000 per year ($750–$1,500)

EOR cost components (no-entity route):

• A per-employee EOR service fee (from $399 p/month with Playroll)
• Pass-through statutory costs (e.g., employer social security contributions)
• Any optional benefits you choose to provide beyond statutory minimums

How an Employer of Record Can Help You Hire in Botswana

Hiring in Botswana can be complex, but it doesn’t have to require setting up a local entity or taking on long-term overhead. With an Employer of Record like Playroll, you get a simple, predictable way to hire compliantly while keeping costs transparent and under control. We help you:

• Hire employees in Botswana quickly without establishing a local entity, eliminating incorporation costs, ongoing administration, and exit complexity.
• Stay fully compliant with local payroll, tax, and employment regulations with Playroll’s payroll services.
• Control your total employment costs, with a clear monthly EOR service fee (from $399 per employee).
• Focus on growing your business, while we manage contracts, payroll, compliance, and labor law obligations end to end.
• Scale up or exit the market easily, without the financial or legal burden of closing a local entity.