Ministry of Economic Development has published the regulation stipulating the newly registered businesses being classified based on the estimated income.
According to the Small and Medium Enterprises Act, businesses are divided into three categories. They are micro, small and medium-sized enterprises.
As per the regulation stipulating the classification of Small and Medium Enterprises (SMEs), the things to look into in determining a particular category of business are the number of employees in the business, the amount of income earned per year, and the net profit per year.
Micro Business Classification:
- Number of employees: 0 – 5
- Total Revenue: MVR 500,000
- Net Profit: MVR 75,000
Small Business Classification:
- Number of employees: 6 – 30
- Total Revenue: MVR 500,000 – MVR 5,000,000
- Net Profit – MVR 75,000 – MVR 750,000
Medium Business Classification:
- Number of employees: 31 – 100
- Total Revenue: MVR 5,000,000 – MVR 20,000,000
- Net Profit: MVR 750,000 – MVR 3,000,000
The SME formula will be used to classify businesses that do not meet these categories used to classify them.
Information can be submitted through the business portal of the Economic Ministry to apply for the classification of business. Although a business submits its own documents to classify the category, the regulation stipulating the business category will be reviewed based on the information provided by MIRA, Pension Office and the Economic Ministry. Based on this information, the Economic Ministry is required to review the classification of businesses by August every year.
According to this regulation, the profile sheet issued through the ministry’s portal will include the classification of the business. Information on businesses that have not been classified will also be published through this portal.