What Exporters Need to Know about Lesotho Foreign Firm Codes and Tax Identification Numbers (TIN)
As of the 1st September 2024, all direct exports to Lesotho must have an Agent of Foreign Firm code (also called Agent Code) on their invoice. The foreign firm code will be the tax identification number (TIN) of a Lesotho-based company that has been appointed to act as an agent on behalf of the foreign exporter to Lesotho Customs. Failure to comply could result in declaration delays, customs blocks, and financial penalties.
Note that this requirement is only for direct exports to Lesotho. Direct exports are exports where the foreign supplier arranges the transport and customs clearance, as opposed to indirect exports, where the Lesotho buyer arranges collection of the goods and the exportation into Lesotho.
Exporters to Lesotho are required to declare their exports with a valid Lesotho Tax Identification Number (TIN. All foreign companies must have a registered local agent with a valid Lesotho Tax Identification Number (TIN) to link all customs activities to Lesotho. Failure to comply could result in declaration delays, customs blocks, and financial penalties.
Here’s what’s changing, what it means for your business, and how to get compliant before your shipments are affected.
What Is a Lesotho TIN and Why Is It Important?
A Tax Identification Number (TIN) is a unique 8-digit number that is issued by the Revenue Services Lesotho (RSL) and is used for the purpose of identifying a taxpayer and helping in facilitating the administration of taxable activities. It is the same as a tax registration number in South Africa. Anyone who is involved in taxable activities in Lesotho is required to have a TIN.
All foreign companies that directly export to Lesotho will be required to have a TIN linked to the company. In order to do this, the foreign company is required to have a Lesotho-based registered agent who will have their TIN linked to the foreign company. This will help in ensuring that the foreign company stays compliant across all tax categories in Lesotho, including income tax, VAT, and customs. Without a valid TIN, customs clearance cannot proceed. For foreign businesses, that means that if they do not have a TIN, then their goods will not be allowed border entry.
What Has Changed for Exporters?
The new regulation was announced in 2024 but was postponed due to technical issues with the ASYCUDA system, and is now fully in effect. All exporters must do the following:
- Register through a Lesotho-based agent who is certified by the Agents of Foreign Firms Association of Lesotho (AFFAL).
- Get the official Agent Code Certificate for the agent, which includes their Tax Identification Number (TIN).
- The Agent Code, which is their TIN, must reflect on all invoices, credit notes, and all customs documentation related to all exports for the foreign company that they are registered with.
Exporters who fail to appoint and register a compliant agent will not be able to clear goods into Lesotho.
Why Are Agents Required?
Foreign exporters are no longer allowed to operate independently in Lesotho for customs and tax purposes. They are now required to appoint a local representative agent to handle all activities that require a TIN. This is for the purpose of:
- The Revenue Services Lesotho (RSL) is able to track tax liabilities and collect VAT where applicable
- Keeping local businesses accountable for compliance
- Ensuring that transactions are legally recognized by the RSL and customs authorities
How to Comply with the New TIN Requirement
Here is a 6-step process to help you stay compliant with the new rules:
Step 1: Contact AFFAL
Reach out to the Agents of Foreign Firms Association of Lesotho (AFFAL). They will be able to allocate a licensed third-party agent who is authorized to register with the LRA on behalf of exporters. They will be issued an agent code certificate to show that they are able to do this on your behalf.
Step 2: Formalize the Agency Relationship
A signed agreement that outlines the agent’s responsibilities, targets and fees between the agent and the exporter is necessary for registration with the RSL.
Step 3: Register the Agent with RSL
The agent is responsible for submitting the signed agreement and required documents to the RSL. Once the application is approved, they will be issued an Agent Code Certificate, which includes their TIN. This code will be used on all customs declarations documentation, which is mainly handled by the customs clearing agent of the exporter.
Step 4: Update Documentation
The Agent Code (TIN) must be included on all customs and commercial documents that are for shipments into Lesotho, including invoices, debit/credit notes, etc.
Step 5: Handle Remittances and VAT
The exporter will be billed monthly for the services given by the agent. If the commissions owed to the agent are more than the VAT threshold, then the agent will be given a VAT certificate and VAT number. The agent will charge the exporter with a VAT invoice. The agent is responsible for remitting VAT to the RSL by the 20th of every month.
Step 6: Share Agent Code with Your Clients
The Agent Code Certificates must be sent by the exporter to all importers who are their customers in Lesotho. This is in order to validate the presence of the exporter in the country and ensure that sales, promotions, and in-store activities comply with regulations.
What If You Don’t Comply?
Having an incorrect, unverified or absent TIN can lead to complications that include:
- Delays in tax processing
- Delays at customs borders
- Rejection of customs submissions
- Blocked declarations
- Loss of tax exemptions
- Fines or penalties
- Criminal charges for use of false TINs
The RSL has made it clear that any foreign exporters who fail to act to get compliant now may face serious disruptions to their supply chains.
Exemptions
Direct exports from a foreigner into Lesotho can apply for exemption if they can prove that they are exclusively exporting to a particular company in Lesotho, for example:
- Franchise-to-franchise relationships
- Supply of specialised equipment to a specific company in Lesotho for a specific purpose.
The Lesotho-based entity will need to contact Lesotho customs and assist in facilitating this process.
Conclusion: Act Now to Stay Compliant
The Lesotho government has implemented these TIN regulations to improve transparency, tax collection, and customs efficiency. They are relevant and mandatory for anyone who wants to export to Lesotho.
Proactive compliance will protect your business from costly delays and penalties — and help ensure your goods move smoothly across the Lesotho border
If you have any questions, you are most welcome to give us a call on 087 550 1038. Alternatively, you can submit a query via our website here.
