You’ve got an idea, and you’re wondering how to register a business in Nigeria? I bring you good news, registering a business in Nigeria is a breeze. The Corporate Affairs Commission(CAC) is certified for the registration of companies in Nigeria as stated in the Corporate and Allied Matters Act (CAMA) 1990.
Without further ado, here you go
- Pick a unique business name and confirm its availability at the CAC
- Do the pre-registration for the company’s name reservation before opting for full registration
- Make the payments for the filing fees
- Make available the required documents for upload
- Submit the original copies of the documents at the CAC office
That’s it. However, below are things you must understand before registering your business at the CAC. They are stated below:
- Importance of incorporating a business in Nigeria
- What type of business can be registered in Nigeria
- How to register a business in Nigeria, a step-by-step guide to getting it done easily
- Documents required to register your business in Nigeria
- Amount of registering a business in Nigeria
- Factors to consider before registering a business in Nigeria
- FAQs
- Last Words
Importance of Incorporating a Business in Nigeria
Did I catch you in the thoughts? Why not start the business and avert the hassle of registering? Before you assume that, you should Know the Pros and Cons of having your business registered. Here we go; First off, it’s required for all businesses in Nigeria to be registered with CAC according to the Companies and Allied Matters Act for the following reasons
#1. Loss of personal assets to Liabilities
Incorporating your business keeps you afloat beyond losing your assets to Liabilities. Corporations are certified business legal entities that have the right to own assets and can carry on business. It can sue, and be sued. Meaning you’re a separate entity from the business and your assets won’t be confiscated to pay up the company’s debts. If you hadn’t had it incorporated, you’d lose all your assets to make up for the debts owed by the business.
#2. No Investments: no expansion
You need investors to invest in your business for expansion and market dominance. Consequently, without incorporation, that would only be a dream. Investors only risk their money on a registered Business.
#3. Goodwill is Profit
To have your business incorporated earns you respect and a good reputation. Your customers and clients will certify you; as trustworthy. Also, goodwill has real-life monetary value.
#4. Perpetual Existence
A business is assured of longevity only when it is incorporated. The death of the founder doesn’t disturb the business. As a legal entity, it can only be shut down by an order from a law court.
#5. Build a brand and stand out
When you have your business incorporated, you won’t need to worry about other companies using your name and logo. CAC makes sure that your identity and brand are secure at home and abroad. Your business becomes a unique entity.
What Type of Business Can be registered in Nigeria
There are three major Business structures in Nigeria.
#1. Sole Proprietorship
The sole proprietorship is a business that is headed by the sole proprietor. In a sole proprietorship, the sole proprietor is responsible for all its profits and liabilities. In other words, its Liabilities are unlimited.
#2. Partnership
It’s a business that two or more people come together to establish. The partners fund the business with a certain percentage of capital. The profit or loss of the business is apportioned to each partnership according to the percentage that was contributed.
#3. Corporation
A corporation also known as a C corp is a business legal entity that is certified by law to own business assets, borrow, and lend. It can sue and be sued. The shareholders involved are distinct from the business. What that means is that they don’t own the business and its assets. Similarly, the shareholders do not inherit the Liabilities of the business. They enjoy little to no Liabilities.
Possibly you’re concentrated on sole proprietorship, Partnership, or Corporation. Regardless, you can register your business at the CAC. Section 814 of CAMA 2020 includes that a business name could be registered as a sole proprietorship or a Partnership. The subsections highlighted the categories of companies that can be registered, Such as:
- Partnership business that doesn’t go by the name of partners.
- Individual businesses that do not have the name of the owner
- Companies/corporations whose corporate name is not on the business name
Now that your concerns have been tended to, you’re set for the next level of action.
Step-by-Step Guide to Getting it Done Easily
Don’t sweat all day on how to register your business in Nigeria. Here is a step-by-step guide to getting it done easily.
#1. Pick a Business Name
You don’t need any special invitation to pick a name for your business. Pick a unique name that suits the business and protect your brand.
However, you may need to keep supplementary names in mind in case the one chosen has already been picked. Let’s face it, name-picking for business can be daunting. My advice? Utilize the internet, go online, and confirm the uniqueness of your company’s name. You can check out some digital tools that can help you achieve uniqueness in the business name selection.
#2. Pre-registration for Name Reservation
Get your result in less than 24 hours after submission. Expect a submission fee of about 500 Naira at the CAC official Portal.
#3. Pay up for Filing Fee
You’re very close to being the entrepreneur you dreamt of, but you need to pay up that filing fee at the CAC official Portal. When that is done, you’ll be issued a filing fee receipt which is a vital requirement in the furthering of the business name registration. Payment varies depending on the type of company you want to register. You can make payments online or at the bank.
#4. Make Available the Required Documents
Progressively, upload the pre-registration scanned documents to the website. Make sure the documents are signed for validation. The documents are:
- Application form
- Filing fee receipt
- Document of Identification for the proprietors of the business: passport photographs
#5. Submit the Original Copies of Your Documents
This is where you take a walk to the CAC office. You’ll have to hand over the original copies of the signed and scanned documents that you uploaded. From there you’re on, wait for the Breaking
Documents Required to Register Your Business in Nigeria
You’re required to provide the following documents:
- Email address and phone number for the company
- The registered address location of the company’s main office
- Government-approved ID cards and passports of the shareholders and directors. e.g. International Passports, Driver’s licenses, National Identity Cards, NIN, etc.
- Name approval Document issued by the CAC
- Objects of the company. These are itemized in the Memorandum of Association.
- Personal information of the Shareholders and directors. They should include: Full name, residential address, date of birth, occupation, etc
- Stamp duty and statutory fees
- Certificate of Incorporation and company resolution. This makes it possible for other companies to become shareholders in the corporation
Amount of Registering a Business in Nigeria
The CAC official filing fee is N10,700 with remita included. The amount of registering a business in Nigeria differs along with your share capital and the type of company that you want to register.
- Name Reservation: N500
- Private Company Registration with share capital up to 1 Million Naira or less: N10,000
- Private company Registration ranging from 1 Million Naira to 500 Million Naira: N5,000 per million share capital
- Private company Registration above 500 Million Naira: N7,500 per 1 Million Naira share capital
- Public Company Registration N20,000 for the first 1 Million Naira
- Public Company Registration ranging from 1 Million Naira to 500 Million Naira: N10,000 per 1 Million Naira share capital
- Public Company Registration above 500 Million Naira: N15,000 per 1 Million Naira share capital
- Registration of the company with no share capital: N20,000
More information on the price checklist for business Registration in Nigeria
Factors to Consider Before Registering a Business in Nigeria
You’re woke, and good to go. The factors to consider before registering a business in Nigeria is one vital key many entrepreneurs have overlooked to the detriment of their careers. Test the waters, look before you leap. See the major factors to put in check before “entrepreneuring.”
#1. Good Business Idea
How well do you know about the business you’re about to venture into? A wholesome business idea is a determinant factor to success. Also, you should have the required skills to bring your goals to reality. You mustn’t be the skilled one, but you can employ skilled hands in the business. In summary, your ideas should solve problems in the society
#2. Innovative Business Plan
A good business plan is essential to success in business. Business plans are detailed information on the items, tools, and manner that you need to make your business a success.
It carries information that covers what the market wants, the competitive strategies, and the business blueprint. Also, it involves financial and managerial predictions. Taking it seriously will keep you smart and expectant. And you’ll know what to chase per time.
#3. Study Your Competitors
You’re not the first in your line of business, similarly, you’re not the last. You must study those that have been there before you, what has kept them solvent through thick and thin. Get to know Their strategies, challenges, prices, packaging, and further. Then you should give top-notch distinction with your products.
#4. Packaging
Speak of the devil, packaging. You must give your product a unique look, and a satisfactory strategy of delivery if you want to sell. Bread remains bread until Totila makes it top-notch.
In marketing, the production concept affirms that clients favor products with high quality. This pertains to products that are well packaged and satisfactory on delivery.
#5. Know your Market
It’s your responsibility to study your target market. This helps in risk evaluation, it will help you to answer the dreaded questions
- Who I’m I producing to?
- Will the patronage rate be as predicted?
When you’re convinced that the feedback is favorable, you should then proceed to the next step
#6. Taxation Policy, Registration, and Licencing Requirements
This has been explained in this article. Confirm if the taxation Policy favors the type of business that you want to establish. Will your business make a profit after the payment of tax? This is serious because as a business in Nigeria, you must pay taxes. Progressively, businesses in Nigeria should be registered with the CAC. By now you’ve known how to register a business in Nigeria and the step-by-step guide to getting it done easily. Refer to this article for memory refreshing.
#7. Enough Capital Funds
The business idea, with a big market demand without money, is only a dream. Many entrepreneurs gave up their dreams of owning a business as a result of insufficient funds.
In your conclusion about your business proposition, you should also know how much capital is required to bring it to reality. Then, you can take a noble risk by applying for a bank loan when you’re convinced that the business will deliver as expected. Alternate ways of generating capital to fund your business are through soft loans and borrowing from family and friends.
This is my opinion: you can buy business stocks and shares with the available capital, be patient over the years and you’ll have a good sum to build with.
#8. Strategic location
One of the ways to successfully run your business is to discover a strategic location. Your products should be popular and known by the majority of folks at a given place and time. This automatically boosts patronage and maximizes profit. Again situate your business in a politically stable terrain. No business thrives in a state of emergency.
#9. Advertising
It’s worth shouting about, utilize every medium possible to keep your products awareness in the mind of the public. Let your product always be in their faces.
You can take your products to prospective customers and clients. Or you can employ social media spaces. Another option is using the WhatsApp broadcast message. Or you can go all out on billboards, radio jingles, television, and fliers.
#10. Profit Management
You should be able to keep track of your business sales and purchases. Check to determine if you’re running on loss or profit. Take stocks, and keep records of overhead costs. So that you can be able to trace Your expenses and profit.
FAQS
Do I need a legal practitioner to register my business name?
No, you don’t need to employ a legal practitioner or a third party to register your business name at CAC.
Can I do my business name Registration online?
Yes, you can do your business name Registration online. Some agents can help you out. Or you can register via the CAC official Portal
Last Words
It’s a breeze knowing how to register a business in Nigeria. The following actions are required. Without further ado, here you go
- Pick a unique business name and confirm its availability on CAC
- Do the pre-registration for the name reservation before opting for full registration
- Make payments for the filing fee
- Make available the required documents for upload
- Submit the original copies of your documents
You’re expected to make ready the following documents
- Pick a unique business name and confirm its availability at the CAC
- Do the pre-registration for the company’s name reservation before opting for full registration
- Make the payments for the filing fees
- Make available the required documents for upload
- Submit the original copies of the documents at the CAC office
If you can think of it, if you’re are determined. You can have it. It all begins with an idea. Stay hungry, employ the right tools, and be amazed by the results. Good luck
