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Posts Tagged ‘CAC’

How to Register a Business Name in Nigeria

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businessname in nigeria

Now that you have created you have identified your source of funds, it is time to register your business name.

Registering a business name in Nigeria is not as difficult as people think it is. You really don’t need to consult a Lawyer or an accountant before you register your business name.

You might be wondering that why do I need to register a business name, the thing is, in this part of the world, people like ‘packaging,’ and your business name is a huge part of that packaging.

No one will take you seriously if you have not registered your business name and some people even prefer to pay into a corporate account rather than paying into a personal account. It all starts from somewhere, you might be thinking, my small business, no business is small.

Your N10,000 per month profit business is going to become a multimillion naira company one day, so don’t underestimate your big idea.

Three Steps to Register Your Business Name

Step 1: Walk into any Corporate Affairs Commission office near you, and ask for name reservation form.

It costs about Five Hundred Naira only. You will be given a receipt and a form. On the form, you will be asked to fill in a few details. The details include your name, your address, your desired business names, type of Business You Want to Register, (Choose Enterprises/Business Name).

You will be required to choose two business names. Ensure that you choose a unique name for your business. Submit the form and wait for the results to come out. Basically, if your business name is approved, you can proceed with your registration.

Step 2: It takes about 2 weeks to get the results, while you wait, prepare your passport photographs, your partner’s passport photographs (if you have one), details of the business and your own personal details. This is the time to clarify and be sure of what will go on record. Once the results are out, study the registration form and fill your registration form.

Even on the CAC Website, it is clearly stated that ‘Individual/Proprietors can register business names without the services of the legal practitioner, chartered Accountant or Chartered Secretary.’

On the website http://new.cac.gov.ng/home/summary-of-fees-and-forms/, Fees for some services include:

 

S/N SUBJECT FEES in Naira (₦)
50 Reservation of Name 500
51 Registration of business name 10,000.00
52 Filing of notice of change of business name 5,000.00
53 Filing of notice of change in business address 1,000.00
54 Filing of notice of change in proprietorship 1,000.00
55 Filing of annual return 1,000.00
56 Filing of notice of cessation of business 1,000.00
57 Filing of other documents (miscellaneous) 1,000.00
58 Search on business name file 1,000.00 per business name file
59 Certified true copy of business name certificate of registration 5,000.00
60 Certified true copies of other documents 2,000.00 per document

 

How to Choose the Right Business Structure

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Araba Slider

As you near the point of starting and registering your business, one of the first decisions you have to make is how to legally structure your business.

The most common options for small businesses are a sole proprietorship, or a limited liability company. It’s very important to understand each business type and select the one that fits with your situation and objectives.

The type of business you create determines the types of applications you’ll need to submit. It will also affect the liability you have as a business owner and the taxes you will need to pay.

Here we will focus on the most common three business structures for small businesses: sole proprietorship, partnership, and Limited Liability Company (or LLC).

Popular Small Business Structure

Sole Proprietorship

A sole proprietorship is the simplest and most common structure chosen to start a business. It is an unincorporated business owned and run by one individual with no legal distinction between the business and you, the owner.

You are entitled to all profits and are responsible for all your business’s debts, losses and liabilities.  Because you and your business are one and the same, the business itself is not taxed separately -the sole proprietorship income is your income.

You do not have to take any formal action to form a sole proprietorship. As long as you are the only owner, this status automatically comes from your business activities. In fact, you may already own one without knowing it. If you are a Make Up artist or a Hair Stylist, for example, you are already a sole proprietor.

Partnership

A partnership is a single business where two or more people share ownership. In general, each partner contributes to all aspects of the business including money, property, and labor or skill. In return, each partner shares in the profits and losses of the business equally.

Because partnerships entail more than one person in the decision – making process, it’s important to discuss a wide variety of issues up front and develop a legal partnership agreement.

This agreement should document how future business decisions will be made, including how the partners will divide profits, resolve disputes, change ownership (bring in new partners or buy out current partners) and how to dissolve the partnership.

Limited Liability Company (a.k.a., LLC)

A Limited Liability Company (LLC) is a flexible form of enterprise that blends elements of partnership and corporate structures.

LLC is almost like the guy that meets in the middle. It is a situation where a person’s financial liability is limited to a fixed sum, most commonly the value of a person’s investment in a company or partnership. If a company with limited liability is sued, then the [claimant]s are suing the company, not its owners or investors.

In Nigeria, you have to register with the Corporate Affairs Commission before you can create any of these business structures.