Capital: Maseru

Population: (2022 est.) 2,084,000

Monetary Unit: Lesotho Loti (LSL, L, M)

Official languages: English, Southern Sotho

Lesotho, officially known as the Kingdom of Lesotho, is a country in Southern Africa. Maseru is the capital and the largest city of Lesotho. The economy is largely based on agriculture, livestock, mining and manufacturing 

The public holidays in Lesotho are as follows;

  1. New Year’s Day (1st January)
  2. King Moshoeshoe I’s Anniversary (11th March)
  3. Good Friday (10th April)
  4. Easter Monday (13th April)
  5. International Workers’ Day (1st May)
  6. Ascension Day (21st May)
  7. Africa Day (25th May)
  8. King Letsie III’s Birthday (17th July)
  9. Independence Day (of Lesotho) (4th October)
  10. Christmas Day (25th December)
  11. Boxing Day (26th December)

The maximum period proposed by the Labour Code is four (4) months.

: Each year, an employee is entitled to a minimum of 12 working days of paid vacation, which can be used whenever the company and employee choose. During the calendar year in which the holiday is due, the employee must take at least six working days off in a row.

Maternity leave typically lasts 12 weeks, which are divided into the six weeks leading up to and following childbirth. Prenatal leave is increased if confinement happens later than expected, but postnatal leave is not affected in the same way.

There are no statutory provisions for paternity leave.

Any absence for illness during the first six months of continuous employment with the same employer may not be compensated. An employee is entitled to a minimum of up to 12 days of paid sick time after working for the same employer for a period of six months.

The Labour Code includes rules for severance pay that are directly related to the employee’s length of service. A severance payment equal to two weeks’ worth of earnings is given for each year of service that an employee has completed with the same company after more than a year of continuous employment. The amount of severance pay is capped at a particular amount, and the Minister updates it frequently after consulting with the Wages Advisory Board. Employees who have been fired by the employer due to misconduct are not given severance pay.

13th / 14th Month Pay: There is no statutory requirement to pay the 13th or the 14th month salary. There is no evidence that bonuses are customary, however employees can negotiate bonuses with the employers.

Types of Work Visas in Lesotho

Lesotho offers several visa categories that cover a number of reasons for foreign nationals to enter the country. Some of the most common visas in Lesotho include: Tourist visas, Business visas, Official and diplomatic visas, Student visas. Lesotho doesn’t offer a work-specific visa. Foreign employees can travel to Lesotho on the basis of a general tourist visa and apply for a work and residence permit after they arrive.

Requirements to Obtain Lesotho Work Visas

In order to obtain a visa for traveling to Lesotho, applicants will need to provide the following documents:

  • A completed visa application,
  • A valid passport with a blank page for the entry stamp,
  • A recent passport photograph,
  • Proof of vaccination against yellow fever,
  • Proof that the applicant has travel health insurance.

Employees should bring the following documents with them to apply for a work and residence permit in Lesotho:

  • A letter of invitation from the employer in Lesotho
  • A valid passport
  • A passport photo
  • A completed application
  • Proof of accommodations in Lesotho

Foreign employees should begin the visa application process by locating the nearest embassy or diplomatic mission of Lesotho. The applicant should submit all required documents to the embassy and then wait in their country of residence for approval.

After the relevant officials approve the visa application, the employee can travel to Lesotho. Upon arrival, they’ll need to apply for a work and residence permit. Foreign nationals can apply for this permit at the Department of Immigration and Passport Services. This department is located within the Ministry of Home Affairs in Lesotho. The required documents for the permit include a letter from the employer, so it’s important for foreign nationals to secure a job before traveling to Lesotho.

Once approval for the work and residence permit has been given, the employee can begin working in Lesotho. The permit will be valid for an initial period of up to two years.


The employment relationship may be terminated at any time by any party. The dismissal of the employee must be objectively justified and be based on circumstances relating to the operational requirements of the business or to the employee (capacity or conduct). A written justification for the decision must be provided by the employer to an employee who has been let go. Marital status, pregnancy, maternity leave, family obligations, lodging a grievance against the employer, religion, political opinion, social origin, nationality/national origin, involvement in trade union activities, lawfully taking leave (authorized absence from work), HIV status, and union membership are all reasons that cannot be used to terminate an employee. Additionally, these are forbidden reasons to fire someone.

  • 07 days’ notice for less than 6 months of service
  • 14 days’ notice for less than 1 year of service
  • one-month notice for more than 1 year of service
  • three-month notice for more than 10 years of service

The Labor Code provides rules for severance pay that are directly related to how long the individual has worked for the company. Two weeks’ worth of salary are paid as a severance payout for each year of service that an employee has completed with the same employer after more than a year of continuous employment.

These include probationary period, annual leave, public holidays, sick leave, maternity leave, overtime pay, notice period, and severance pay. Statutory benefits also include social security benefits.

A typical workweek consists of 45 hours spread over a five- or six-day reference period. Daily working hours in a five-day workweek are nine hours, whereas in a six-day workweek, they are eight hours for five days and five hours for the sixth.

The weekly maximum for general overtime work is 11. A supplement is paid for overtime labor in addition to the employee’s regular salary for equivalent work performed during regular business hours. Employees are paid at least 25% more for working overtime hours, or 125% of their regular pay.

The Labor Code mandates a legally required written notice period, and it provides that, barring a collective bargaining agreement that specifies otherwise, the notice time shall be as follows:

  • 07 days’ notice for less than 6 months of service;
  • 14 days’ notice for less than 1 year of service;
  • one-month notice for more than 1 year of service;
  • three-month notice for more than 10 years of service;

Individual income tax generally is levied at progressive rates of 20% or 30%. Any chargeable income from M 1.00 to M 64, 200.00 or less per year is taxed at the rate of 20%. Any amount more than M 64, 200.00 is taxed at the rate of 30. A flat rate of 40% is levied on trustees, non-exempt fringe benefits that are not taxed at the employer level and non-residents who elect to be taxed by assessment on income that otherwise would be subject to withholding tax.

Lesotho does not have a social security system or mandatory social security contributions for employees in Lesotho.

Personal Deductions: A resident individual (other than a resident minor) is allowed a non-refundable personal credit of LSL7 260 against the individual’s liability for income tax. As a rule, the personal credit is available only to residents of Lesotho. However, it is also available to non-residents who live permanently outside Lesotho but who are employed full-time in Lesotho or engaged full-time in a business in Lesotho. An employee may deduct contributions to an approved resident superannuation fund, up to 20% of employment income. Charitable donations generally are not tax-deductible expenses, except for sports related donations of LSL1 000 or more, which may be deductible if certain conditions are fulfilled.

Business Deductions: Interest incurred by a taxpayer on borrowings used by the taxpayer in the production of income subject to tax is an allowable deduction, subject to thin capitalization limitations. Research and experimental expenditure if incurred in the production of income subject to tax. Depreciation on depreciable assets

VAT is levied on the supply of goods and services within and outside Lesotho by taxable persons in Lesotho, and on imports. The standard VAT rate is 15%. The VAT rate for electricity is 8% and telecommunications is 12%. Banking services, except for the leasing of bank deposit boxes and insurance services, are exempt from VAT. Zero-rated supplies include food supplies, livestock, and poultry feed. Exports also are zero-rated (although exports of natural resources will be exempt. 

The following lists the withholding rates for various forms of payment (the tax is a final tax for non-residents, unless the non-resident files an income tax return, in which case the non-resident may elect to be assessed at the applicable income tax rate). Payments to both businesses and people are subject to the non-resident rates, which may be lower depending on the current tax treaty.


Dividends                                      =          Nil

Interest                                           =          10%

Royalties                                        =          Nil

Management Fees                           =          Nil

Natural Resource Payments             =          Nil

Lesotho Sourced Services               =          Nil

Payments to Resident Contractors    =          Nil


Dividends                                       =          0%/25%

Interest                                           =          15%/25%

Royalties                                        =          15%/25%

Management Fees                           =          15%/25%

Natural Resource Payments             =          25%

Lesotho Sourced Services               =          10%

Payments to Resident Contractors    =          5%

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