Do I Need a Local Entity to Hire in Lebanon?

In Lebanon, a "local entity" refers to a recognized presence that allows you to act as an employer—typically a subsidiary or branch office. This setup enables you to manage payroll and comply with local employment laws effectively.

Without establishing a local entity, you can't register as an employer, manage mandatory social security contributions, or run compliant payroll. An alternative is to use an Employer of Record (EOR), which can handle these responsibilities on your behalf.

What is Required to Employ Someone in Lebanon?

• Local employing entity required to directly employ? Yes (You need a local entity to register as an employer with the Ministry of Labor.)
• Payroll registration required? Yes (You must register with the Ministry of Finance for payroll compliance.)
• Withholding/tax remittance required? Yes (Employers must withhold income tax and remit it to the tax authorities.)
• Social contributions required? Yes (Employers are required to contribute to the National Social Security Fund.)
• Local employment agreement required? Yes (Employment contracts must comply with Lebanese labor law.)
• Mandatory benefits to budget? Yes (Statutory benefits include end-of-service indemnity and annual leave.)
• Works council/collective agreements considerations? Often (Certain sectors may have collective agreements impacting employment terms.)

Best Options If You're Hiring in Lebanon

Can I Hire Contractors Instead of Setting Up an Entity?

Yes, but be cautious about misclassification risks.

While hiring contractors in Lebanon doesn’t require a local entity, you must ensure that the contractor is genuinely independent. Misclassification can lead to legal issues, especially if the contractor is perceived as an employee.

• Ensure the contractor has multiple clients to demonstrate independence.
• Avoid controlling the contractor's work hours or methods.
• Be aware that strong labor protections in Lebanon can complicate contractor relationships.

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

Typical entity setup timeline: It often takes 4–8 weeks to set up an entity in Lebanon, depending on the required registrations.

Ongoing cost categories (entity route):

• Accounting, bookkeeping, and statutory filings: Estimated 1,500,000–3,000,000 LBP per month ($100–$200)
• Payroll provider: Estimated 300,000–600,000 LBP per employee per month ($20–$40)
• Employer registrations and recurring compliance: Varies by complexity, typically included in accounting fees.
• Corporate tax filings and annual reporting: Estimated 1,000,000–2,000,000 LBP per year ($66–$133)

EOR cost components (no-entity route):

• A per-employee EOR service fee (from $399 per month with Playroll)
• Pass-through statutory costs (e.g., employer social security contributions, typically around 14.5% of gross salary)
• Any optional benefits you choose to provide beyond statutory minimums.

How an Employer of Record Can Help You Hire in Lebanon

Hiring in Lebanon 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 Lebanon 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 managed 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.