How To Register A Business In Nigeria
How to Register A Business In Nigeria: There are thousands of businesses being established on a daily basis in Nigeria by individuals. Cooperate bodies or associations. It is required that anyone that wants to set a business in Nigeria needs to register his or her business to have the legitimate right to operate in the country.
You can not talk about company registration without mentioning CAC. CAC’s full meaning is the corporate affairs commission of Nigeria and it is a board regulating and registering business names and companies in Nigeria.
The functions of this board are to get every business operating in Nigeria to register and provide them with a registration code (RC).
There are basically two categories of companies or businesses one can register in Nigeria, the profit and the nonprofit making business also known as the incorporated trustee.
Companies with a profit motive are divided into three categories:
- Company limited by shares( a variant of which can be a private or public limited by shares, with Ltd and Plc designated respectively)
- Company limited by Guarantee( with Ltd/Gte designated)
- Unlimited company( shell unlimited)
The common factor in all the above categories of company registration is the concept of “separate personality”. This concept implies that the individual is a separate personality from the company and the company is separate from the shareholders.
It simply implies that the liability of the shareholders is limited by shares held and unpaid for by him. When there is any legal case the company maintains and defends suits in its names without mentioning any director or shareholder( unless In an exceptional case).
These are basically not-for-profit. Churches, Mosques, Foundations, etc are none profit-making ventures that are registered in this category. The concept in operation of this registration process is to register the name of a certain individual against a name. Shining light church. On list three trustees are all registered against that name. Any legal suit against the trusty goes like “the incorporated trustees of Shining Light Church.
Setting up a business in Nigeria, there are fundamental steps that are required:
What Type of business:
This must be the question that must come to mind in determining the decision to take on the business to operate. There are several businesses but you have to do critical research on the type of business with less risk and high turnover or business you think you can manage and finance adequately.
It is also important to decide promptly as several businesses operate under legal and regulatory frameworks that may require rigid and stringent rules for registration.
Do you need partners or a sole proprietorship?
The next decision after deciding on your business type, you have to consider if want to operate a one-man business and fly solo and fly with your business or you want to do a partnership form of business.
Starting a business as a sole proprietor does not limit you from subsequent increases in the business partnership in the future.
This stage is important because it determines how your business can be registered and the policies that are accompanied by the business.
What is the legal form of the business?
There are so many legal forms of business in operation. It can be a limited liability company, a partnership, or a sole proprietorship. It can also be limited by a guarantee (NGO) or a non-profit business.
Each of the forms of operations operates under a unique legal framework and tax jurisdictions. A sole proprietor does not have the acronym “Ltd” after tier business name and operates on its uniqueness and policies.
How much capital do you have?
Starting up a business requires some form of capital, your ideas for starting up a business can be established if you can source your initial capital for the business.
Here are some round-down costs for registering a company, though there are more to this.
1.Reservation of Name, N500.00
2.Registration of the private company with a share capital of N1million or less, N10,000.00
3.Registration of private company/Increase in Share Capital above N1million and up to N500million
N5,000.00 for every N1million share capital or part thereof.
4.Registration of private company/Increase in share capital above N500million, N7,500.00 for every N1million share capital or part thereof.
The range of charges varies base on the category of company registration, it implies the amount of money is set aside drawing from the above cost of registration. Registration can also be done online.
Do you have a business name?
The next thing you have to consider is the business name. The business name is very important in any business you want to venture into, the name should possibly portray the function or activities of the company.
The business name should be unique at least within the same industry, to achieve this you can do research through the website of the corporate affairs commission (CAC) or go through a legal practitioner. When your proposed name is approved you can pay to reserve it or proceed with your company registration.
What Is Your Registered Address?
Your business registration address comes next as part of the requirement to fill your application to the CAC. The registered address is the official address of your business or company, it is also the basis for which tax authority will use to locate your business.
Get A Lawyer & Register Your Company
When all the necessary steps have been met, you have to proceed to meet your lawyer. Let the lawyer do the registration of your company along with the fees be handed over to him. your company registration is expected to be registered within days if it is not limited by the guaranty.
Get a logo
Once your company has been registered you have to start the promotion of your commercial brand. Publicity of your company with a catchy logo of your company, ensure it is a material or thing that represents your business. With a good logo, your brand will be effectively boosted and publicized.
Get a stamp and a seal
To safeguard the reputation of the company, every company must have a legal stamp and seal which is unique to it. The seal must be available for filling of forms or signing important contractual documents for your business.
Get a letterhead
A letterhead represents the company’s official piece of paper use by the company to communicate information or message to third parties. The company or business’s latter head will include logo, Company address, and name as well as the board of directors.
Open A Bank Account
Once your company Is fully registered, you should take the incorporated documents to a commercial bank to open a corporate account for you. The corporate account takes a short time to have set up for you to operate, usually within 48 hours.
The major requirement which is then incorporated document the commercial bank you are operating will make known to you other requirements. the demand could be, Like the referee who has a current account etc.
Get A TIN
A TIN is a Tax Identity Number for individuals and corporate organizations. This Is one of the basic requirements of every business owner, a new business can easily obtain a tin from any tax office where the registered business is located.
Without a company TIN, it can be difficult to get a contract or business deal from any private or public sector. Without the TIN it also implies that the company is not a tax complaint resulting in potential tax Liability.
Get A Website & Social Media Account
When necessary requirement for your business registration is being officially concluded. The important thing to do is to create a website and social media handles.
This helps your business to get the visibility and publicity that is required for your business to flourish. Your website creates an avenue for people to email you and your staff through your official email.
Hope this helps, See you at the top.