Food and drink (restaurants, cafés, warungs): what the law asks of you

Start here: guides for Food and drink (restaurants, cafés, warungs)

Written by AI from the official law texts and checked against them. Not reviewed by a lawyer. Not legal advice.

The first things to do

The most urgent steps from the guides below. A step with a condition is only for businesses in that situation.

1. Get a restaurant licence before you open, and renew it every year From: Your food and drink business: hygiene, alcohol, tobacco Before you open. Ask to renew before the 1-year licence runs out; the general licensing law says renewal requests go to SERVE at least 30 days before the licence ends.
2. Pay 5% services tax in months your hotel, restaurant or bar takes US$500+ From: Your taxes: what to file, pay and hold back Every month, by the 15th of the next month
3. Show the full price on everything you display or advertise From: Your customers: prices, receipts, warranties and refunds Before goods go on display or an advert goes out
4. Declare your business activities at SERVE before you start From: Your business registration: SERVE and yearly filings Before you start any business activity
5. Check the building is licensed for the business you will run in it From: Your premises: renting, owning and building Before you sign a lease or buy, and before you change what the place is used for
6. Price everything in US dollars and take payment only in US dollars From: Your money: US dollars, cash, QR payments and receipts At every sale
7. Ask to renew your licence at least 30 days before it runs out From: Your licences and inspections No later than 30 days before the expiry date

Guides for every business like this

• Your business registration: SERVE and yearly filings

  Every business must tell SERVE what it does and be registered there, then keep that record up to date.
  7 steps, 2 to do first

  1. Declare your business activities at SERVE before you start Do this first Before you start any business activity
  2. Register your business in SERVE's commercial register Do this first Company: within 15 days of signing the founding deed. Sole trader: when you start, at the latest within 30 days
  3. Company: name a legal representative who lives in Timor-Leste When you set up the company; register any change within 30 days
  4. Register changes to your business at SERVE within 30 days Within 30 days of the change
  5. Company: approve your yearly accounts by 31 March Within 3 months after the financial year ends (31 March for a calendar year)
  6. Company: file the approved accounts at SERVE within 30 days Within 30 days after the owners approve the accounts: by 30 April at the latest when the financial year is the calendar year
  7. Tell SERVE if you close or pause for more than 6 months When you stop, or once a pause lasts more than 6 months. Register the end, suspension or dissolution within 30 days.

• Your licences and inspections

  Every business declares its activities at SERVE first. Shops also enrol in the Ministry of Commerce's register, and some need a licence.
  4 steps

  1. Ask to renew your licence at least 30 days before it runs out No later than 30 days before the expiry date
  2. Tell SERVE when you move, change or stop your business Within 10 working days of the change (licensed businesses); before the change for a trade licence
  3. Let AIFAESA inspectors do their checks and answer their questions Whenever inspectors visit
  4. If AIFAESA charges you, reply by the deadline in its notice By the deadline in AIFAESA's notice (30 days at most)

• Your taxes: what to file, pay and hold back

  Every business needs a tax number and pays income tax; staff, rent, hotel or restaurant sales and imports add more.
  7 steps, 4 to do first

  1. Make sure your business has a tax number (TIN) Do this first Before you start trading
  2. Take wage tax out of salaries and hand it in by the 15th Do this first If you employ staff Every month, by the 15th of the next month; yearly wage tax return by 31 March
  3. Pay 5% services tax in months your hotel, restaurant or bar takes US$500+ Do this first Every month, by the 15th of the next month
  4. File your yearly income tax return and pay the rest by 31 March Do this first By 31 March, for the year that ended on 31 December
  5. Pay income tax in advance: 0.5% of your sales, every quarter Within 15 days after each quarter ends: by 15 April, 15 July, 15 October and 15 January (monthly by the 15th if last year's turnover was over US$1,000,000)
  6. Importing goods? Pay import duty, sales tax and any excise at customs If you import goods yourself Each time you import goods, at customs
  7. Company paying a builder or architect? Keep back 2% or 4% for tax If you are building or renovating Within 15 days after the end of the month in which you pay

• Social security for you and your staff

  If you have staff, you send INSS 10% of their pay every month (6% from you, 4% from them). If you trade in your own name, you must register too.
  9 steps, 3 to do first

  1. Register your business and each worker with INSS Do this first If you employ staff Business: the day your first worker starts. Each worker: from their first day, at the latest when you send the first monthly pay list that includes them.
  2. Send INSS your monthly pay list by the 10th Do this first If you employ staff By the 10th of the following month
  3. Pay 10% of each worker's pay to INSS between the 10th and the 20th Do this first If you employ staff Between the 10th and the 20th of the following month
  4. Register yourself with INSS if you trade in your own name Now, if you are not registered yet. The grace period of 365 days for sole traders after the 2021 change is over.
  5. Work out the 10% on the right pay items If you employ staff Every month, when you prepare the pay list
  6. Tell INSS when a worker leaves or a work contract is suspended If you employ staff By the 10th of the month after it happens
  7. For foreign staff insured at home, get proof every year If you employ foreign staff Every year
  8. Check if you get the small-employer discount on your 6% (ends 2026) If you employ staff Every month until the end of 2026
  9. Tell INSS within 10 days if your business details change or it closes If you employ staff Within 10 days of the change

• Your premises: renting, owning and building

  Whether you rent, own or build the place you work from, these rules decide what you must sign, register and get licensed.
  10 steps, 3 to do first

  1. Put every lease in writing and have both sides sign it Do this first If you rent the place where you work or you rent out property long-term Before you move in or hand over the keys
  2. Check the building is licensed for the business you will run in it Do this first Before you sign a lease or buy, and before you change what the place is used for
  3. Get a building licence before you build, extend, alter or demolish Do this first If you are building or renovating Before any work starts
  4. Keep back 10% of the rent you pay and pay it to the Tax Authority If you rent the place where you work Every month you pay rent; pay the tax by the 15th of the next month
  5. As a landlord, pay the 10% rent tax yourself if the tenant is a person or the UN If you rent out property long-term Every month you receive rent; pay by the 15th of the next month
  6. Buy land or buildings only by public deed, and check who may own If you own land or a building Before you pay for land or a building
  7. Register a land or building purchase within 30 days If you own land or a building Within 30 days of signing the deed
  8. Post the licence at the site and keep the works on schedule If you are building or renovating From the day the building licence is issued until the works end
  9. When the works are finished, ask for the inspection and use licence If you are building or renovating As soon as the works are finished, before you open or move in
  10. Get the landlord's written OK before you sublet or share the space If you rent the place where you work Before anyone else uses part of your rented space

• Your customers: prices, receipts, warranties and refunds

  If you sell anything to the public, these rules apply to you.
  9 steps, 3 to do first

  1. Show the full price on everything you display or advertise Do this first Before goods go on display or an advert goes out
  2. Charge exactly the price shown, and pay back any overcharge Do this first At every sale
  3. Repair, replace or refund when what you sold is faulty Do this first When a customer reports a fault
  4. Give a written quote before you start any service job Before the work starts
  5. Write labels, receipts and contracts in Tetum or Portuguese Before goods go on sale, and on every receipt and contract
  6. Keep every advert true, clear and in Tetum or Portuguese Before you publish or post any advert
  7. Take expired, damaged or fake goods off sale When stock arrives, and on the shelf every day
  8. Never agree prices or share out customers with competitors At all times
  9. Keep simple records of stock bought and sold, with prices If you import goods yourself At every purchase and sale

• Your money: US dollars, cash, QR payments and receipts

  If you sell anything and get paid, in cash or by QR, these rules apply to you.
  8 steps, 2 to do first

  1. Price everything in US dollars and take payment only in US dollars Do this first At every sale
  2. Accept US dollar notes and coins and the Central Bank's centavo coins Do this first At every sale
  3. Keep your books, invoices and receipts in US dollars Every time you record a sale, a cost or a payment
  4. Use only the QR code your bank or payment provider gives you If you take digital payments Before you take QR payments, then check your code regularly
  5. Check each QR payment in your own app before you hand over the goods If you take digital payments At every QR payment
  6. Charge the same price whether customers pay by QR or in cash If you take digital payments At every QR sale
  7. Offer money services only with Central Bank approval Before you offer the service
  8. Declare cash of US$10,000 or more when you cross the border If you import goods yourself Each time you enter or leave the country with cash

• Your online sales, customer data and adverts

  If you sell online, keep customer details or advertise, these rules apply to you.
  7 steps, 3 to do first

  1. Show your business details, prices and terms clearly on your website Do this first If you sell online Before you start selling online, and whenever the details change
  2. Before checkout, show the full price, payment options and return rules Do this first If you sell online On every order, before the buyer pays
  3. Protect online payments and customer details with secure technology Do this first If you sell online Before you take your first online payment, and always
  4. Never write or post fake reviews of your products or services If you sell online Always
  5. Give an easy way to stop your marketing emails, and respect every request Every time you send a marketing email
  6. Ask permission before you use a person's photo, video or words in an advert Before you post or publish
  7. Keep digital business records readable, unchanged and dated For as long as the law says to keep each record

• Your food and drink business: hygiene, alcohol, tobacco

  If you cook, serve or sell food, drinks, alcohol or tobacco, these rules apply to you.
  10 steps, 4 to do first

  1. Get a restaurant licence before you open, and renew it every year Do this first Before you open. Ask to renew before the 1-year licence runs out; the general licensing law says renewal requests go to SERVE at least 30 days before the licence ends.
  2. Keep food safe every day: check risks, cold storage, clean water, closed bins Do this first Every day
  3. Never sell tobacco to under-17s; sell only packs of 20 or more Do this first If you sell cigarettes or tobacco Every sale
  4. Sell alcohol only from your licensed premises, never on the street Do this first If you sell alcohol Every sale
  5. Set up your kitchen, toilets and dining area to the legal minimum Before the licence inspection, and keep it that way
  6. Keep sick staff away from food, and train everyone who handles it Before someone starts handling food, and every day after
  7. Show prices in US$ and Tetum or Portuguese, and keep a complaints book From the day you open
  8. Keep the street outside clean, clear and quiet Every day
  9. Keep smoking out of indoor areas and put up no-smoking signs From the day you open
  10. Stop handing out single-use plastic unless it is compostable and biodegradable Every time you pack or hand out food and drinks

Guides that depend on how you run your business

• Your staff: hiring, pay and time off

  If you have even one employee, these rules apply to you. If you employ staff
  10 steps, 3 to do first

  1. Give every employee a written contract, signed by both of you Do this first If you employ staff Each time you hire someone; fix it now for anyone who has no contract
  2. Pay at least the minimum wage, on time, with a pay slip Do this first If you employ staff Every payday, at least once a month
  3. Keep an up-to-date staff register, including overtime hours Do this first If you employ staff From your first employee, and whenever something changes
  4. Keep to 8 hours a day and 44 a week, and pay extra for overtime If you employ staff Every time you plan shifts or ask for extra hours
  5. Give a paid weekly day off, 12 working days' leave and public holidays If you employ staff All year; plan leave early in the year
  6. Pay the annual allowance (13th month) by 20 December If you employ staff By 20 December every year
  7. Before dismissing anyone, follow the written procedure If you employ staff Before you end anyone's job
  8. When a job ends, pay what you owe and hand over the papers If you employ staff On or before the worker's last day
  9. Handle sick leave: pay the first sick days and point staff to INSS If you employ staff When a worker brings a medical certificate
  10. Give maternity and paternity leave, and protect pregnant workers If you employ staff When a worker tells you she is pregnant, and around the birth

• Your workplace: safety, first aid and accidents

  If you have even one worker, you must keep them safe at work, and you pay the fine if you don't. If you employ staff
  10 steps, 3 to do first

  1. Walk through your workplace, list the dangers and fix them Do this first If you employ staff Before you open, and again whenever the work, equipment or premises change
  2. Set up first aid, fire extinguishers and a clear way out Do this first If you employ staff Before you open; check extinguisher expiry dates regularly
  3. Teach every worker to work safely, in a language they understand Do this first If you employ staff On each worker's first day, and whenever their job, equipment or technology changes
  4. Give free safety gear where danger remains, and make sure it is used If you employ staff Before the risky task starts
  5. Report a work accident that hurts a worker by the next working day If you employ staff By the next working day; at once after a death or very serious accident
  6. Keep the place clean and well lit, with separate toilets for men and women If you employ staff All the time
  7. Service your machines and equipment every 6 months If you employ staff Every 6 months
  8. Let only card holders use forklifts, diggers, cranes and similar machines If you are building or renovating Before anyone uses the machine; renew the card every 3 years
  9. Keep young, pregnant and breastfeeding workers away from banned work If you employ staff Before you give them the task
  10. Set up a safety committee if you have over 20 workers or risky work If you employ staff As soon as you pass 20 workers or start high-risk work; then 4 meetings a year

• Foreign owners, staff and guests: visas and duties

  If a foreigner owns part of your business, works for you or stays with you, these rules apply. If you employ foreign staff or your business has foreign owners or you host foreign guests
  8 steps, 4 to do first

  1. Get a work visa for each foreign worker before they start Do this first If you employ foreign staff Before the worker starts; apply early, from abroad
  2. Give each foreign worker a written contract, with the same rights as locals Do this first If you employ foreign staff Before you apply for the work visa
  3. Record every foreign guest in a register stamped by the Migration Service Do this first If you rent out property long-term When each foreign guest checks in; add the departure date when they leave
  4. Foreign owner or manager living here: get a class II business visa Do this first If your business has foreign owners Before the owner or manager starts running the business from here
  5. Keep each foreign worker in the job and business their visa is for If you employ foreign staff Before any change of job or employer
  6. Renew visas at least 15 days, and residence permits 30 days, before expiry If you employ foreign staff At least 15 days before a visa ends; at least 30 days before a residence permit ends
  7. Tell the Migration Service when a foreign worker's job ends If you employ foreign staff As soon as the job ends
  8. Check if your project qualifies for tax benefits from TradeInvest If your business has foreign owners Any time, once your investment reaches the minimum

• Your vehicles: driving, rent-a-car and passenger transport

  If your business drives, rents out or carries people in vehicles, these rules apply to you. If you use vehicles for your business or you rent out vehicles
  9 steps, 6 to do first

  1. Register every vehicle with DNTT and keep its registration valid Do this first If you use vehicles for your business or you rent out vehicles Before the vehicle goes on the road; each year for the circulation fee; within 30 days of a sale, a move or a write-off
  2. Insure every vehicle for the damage it may cause to others Do this first If you use vehicles for your business or you rent out vehicles Before the vehicle goes on the road, and without gaps after that
  3. Let only licensed, sober drivers use your vehicles, with belts and helmets on Do this first If you use vehicles for your business or you rent out vehicles Before anyone drives for you, and on every trip
  4. Ask DNTT which licence your rental vehicles need before you rent them out Do this first If you rent out vehicles Before you rent out a vehicle, and for each vehicle you add
  5. Check every renter's licence and keep a record of who has each vehicle Do this first If you rent out vehicles At every rental
  6. Get a DNTT licence before you carry passengers by road for money Do this first If you carry passengers Before the first paid trip; renew every year
  7. Keep the vehicle papers and insurance certificate in every vehicle If you use vehicles for your business or you rent out vehicles On every trip
  8. Swap to the new DNTT number and plates by March 2028; keep plates readable If you use vehicles for your business or you rent out vehicles By about 27 March 2028 for vehicles registered before 27 March 2026; then every 5 years, or at once if a plate is damaged
  9. Import only cars and motorbikes up to 5 years old, checked before shipping If you use vehicles for your business or you rent out vehicles Before you buy and ship a vehicle

• Children in your care: safety, schools and preschools

  If children spend time in your care, such as at a school, preschool, club or class, these rules apply to you. If you work with children
  3 steps, 1 to do first

  1. Report any child in danger, and report crimes against a child to police Do this first If you work with children As soon as you learn of the danger
  2. Keep children's details private; ask parents before sharing any If you work with children At enrolment, before you collect or share any child's details
  3. Do not call your service a 'preschool' until it holds a licence If you work with children Before you advertise or sign up families

The laws behind these guides

This is not a complete list. Laws SOT has not checked may also apply to you.

Is this your business?

Merchants on Stays of Timor get these guides as their own to-do list, based on the answers they give about their business.

See your own to-do list