Now that You’ve Registered Your Business, What Next?: Obligations of Business Names After CAC Registration
For most small business owners, registration of their businesses is an ordeal task, and once that task is fulfilled, they think that owe no other obligations to the government. But that is far from the truth.
Fortunately, or unfortunately, registering your business is just the beginning of a statutory mandate. In other to keep within the legal parameters of the law, there are several obligations that your registered business must meet, whether or not you have started operating the business. This is why it is advisable that, unless you have started or are about to start your business, don’t register it; because, from the moment you register your business, time to meet those obligations start running against you.
This article takes a look at a list of some of those obligations that your registered business owes to government agencies.
Obligations to the Corporate Affairs Commission
Filing of annual returns
Filing of annual returns is a compulsory post incorporation filing under the CAC. This is to be done not later that the 30th of June of every year, except the year of incorporation. The basic information for the filing of annual returns for a business name is the details of the company, and a statement about the total revenue and total assets of the business for the year of filing. Failure to comply attracts default. So, if you registered your business name in July 2022, you will start the filing of your annual returns in 2024. But you will file in 2024 the annual returns for January to December of 2023. This filing must be done between the 1st and 30th of June 2024. That’s the way the filing works.
Other post incorporation matters
Apart from the filing of annual returns, there are some other post incorporation filings, which although not ordinary compulsory, become compulsory when you change something or are about to change something about the business. These changes include, change in business name, address of business, particulars of proprietors, nature of business, winding up, etc. These changes must be filed with the CAC within 28 days of that change. Failure to do this attracts penalty.
Tax Obligations
Obtaining Tax Identification Number (TIN)
Every registered business must have a TIN for the purpose of tax payments. It is also one of the requirements to open a bank account. Unlike companies which are assigned their TINs after registration with the CAC, business names must officially apply for their TINs after registration. To obtain the TIN, proprietors of business names must present their CAC documents at the nearest FIRS office. The TIN is usually processed within 5 working days, and it is free. All that is required is the submission of the registration documents and the filling of certain tax forms.
Payment of taxes
Ordinarily, the tax payment obligations of the proprietors of a business name falls under the Internal Revenue Services of the states where they operate. This is because a business name is regarded as not been different from its owners. So the taxes to be paid by the proprietors of the business name would be calculated on the basis of the profits generated by the business at the end of a calendar year. Another way to put it is that the profits generated by a business name is are liable to personal income tax because the business name and its proprietors are considered as one and the same. And under the law, the Internal Revenue Services of the States are responsible for the collection of personal income tax.
Although many businesses and personal businessmen and women avoid taxes, it is always good to be on the side of the law, by sorting out the modalities for payment before embarking on your business.
Other Government Licenses
SCUML Certificate
SCUML stands for Special Control Unit Against Money Laundering. The agency is an arm of the Economic and Financial Crimes Commission (EFCC). It is mandatory for Associations and certain companies to register obtain a SCUML certificates before commencement of operations. It is also a mandatory requirement for the opening of bank accounts for those associations and companies. However, the SCUML certificate is generally not compulsory for business names, unless the business name falls within those specified by the SCUML. Registering and obtaining SCUML certificate is free and fairly easy. Just visit the SCUML site to register. Fill in the forms appropriately, and you will be notified almost instantly if your form was accurately filled and when to expect a feedback from the agency on the readiness of the certificate.
Trademark
Although, not compulsory, some businesses may need to trademark a name, sign, or logo about their business. Those who register trademarks do so to safeguard the usage of their business names or logos by other persons. So, if you would like to further safeguard your business name from unauthorised usage by others, you could as well trademark the name. But note that, the procedure for trademark is different from registration of business names. And you may not be able to trademark the exact name you used for your business name registration. For instance, if you register Nice Music Enterprises, you will not be able to register the name; you can only register Nice as a name.
Trademarks are often used to register products and logos used by the business name. So, under trademarks, you can register just name only, logo only, or name and logo. It is very essential that this is done for business names who intend to produce a product with a different name from their registered business names so that they do not infringe on an already registered trademark, or prevent others from infringing on their trademark.
NAFDAC Certificate
Many people are familiar with this acronym. It stands for National Agency for Food and Drugs Administration and Control. They are the agency of the federal government responsible for the regulation of foods, drugs, cosmetics, chemicals, medical devices, packaged water, and any other consumables either produced or imported into the country. Basically, they certify that the product is healthy for consumption, and that it is produced under a healthy condition. If you are into the sale, production and distribution of packaged water, packaged foods, drugs or chemicals, be sure to seek NAFDAC approval before you embark on the business. Of course you would need to have registered the business name before you make the application.
Articles on this site are meant for general knowledge only, not as professional advice. If you need personal advice on matters contained herein, you are advised to contact a professional.
We are a firm of legal practitioners and CAC certified agents. We help business owners, entrepreneurs and associations register their businesses, companies and associations with ease. If you need our help with any of the matters contained in the article, feel free to send us a mail at niyiama@yahoo.com or reach us on WhatsApp @ +234-08126194751.
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