CAC Business Name Registration Expert Guide | CAC Pre Incorporation

Introduction: What Is Business Registration?

Business registration is a process in which a business is officially registered under the laws of a country in order for it to become legal.

In Nigeria, businesses are registered through the Corporate Affairs Commission (CAC) which was established for this purpose. Upon successful registration, a certificate of registration and a registration number is issued to the owner of the business.

This blog post will be addressing issues like:

• how many types of business registration are there in Nigeria?
• What is the cost for registering a business in Nigeria
• How long does it take for a CAC business name registration to be completed?
• What are the benefits of registering my business in Nigeria?
• What are the differences between a business name and company?
• Can i register a business by myself or do I need a lawyer?
• what documents do i need for the registration?

We will also show you a detailed step by step procedure to register your business in the comfort of your home using your laptop or phone. Therefore, ensure to read this post till the end.

Watch complete video on CAC business name registration in Nigeria

CAC Business Name Registration: The Legal Angle

The Corporate Affairs Commission (CAC) of Nigeria was established by law to regulate the formation and operations of companies in Nigeria. In addition, the commission oversees the registration of companies & and businesses as well as post-incorporation matters.

The laws governing business registration in Nigeria are quite numerous. However, the key legislation on business registration is the Companies and Allied Matters Act, (CAMA), LFN 2020. Under this law, any person can register or take part in the registration of a business in Nigeria, irrespective of his/her race, colour, nationality religion or sex.

However, this law places a restriction on certain types of persons from registering or taking part in the registration of businesses in Nigeria.  A person is not qualified to register a business if:

1. He is underage (less than 18 years of age) or
2. He is of unsound mind and has been so found by a court in Nigeria or elsewhere; or
3. an undischarged bankrupt; or
4. disqualified under section 254 of the Act (CAMA) from being a director of a company.

Notwithstanding, a person who is less than 18 years can still be part of a company formation as long as there are up to two adult members of the business.

What Are The Different Types of Business Registration in Nigeria?

There are several types of business registration in Nigeria but in this post we will be considering six types namely:

• Sole Proprietorship
• Private limited company
• Public Limited company
• Limited Partnership
• Limited Liability Partnership
• Public Company Limited by Guarantee
• Private Unlimited Company

Let;s briefly examine each of them.

Sole Proprietorship:

A sole proprietorship is a type of business structure whereby an individual owns and operates a business. Furthermore, It is the simplest and most common form of business ownership in which the business owner is called the sole proprietor.

In this business structure, the owner is the same as the business itself and bears the liability incurred by the company. Also, the business owner enjoys the profit for the business alone.

Sole proprietorship is also known as a business name, therefore its registration allows the business to operate a corporate business account in its name.

This business structure is most appropriate for traders, artisans, lawyers, accountants, and small businesses owned by an individual or a small group of individuals who are either required by law to operate through a business name or who have a very small budget.

Private Limited Company:

A private limited company is a business that operates as a full-fledged company. It is regarded as a “juristic person,” which means that it has the right to sue and be sued in its registered name. 

Consequently, this type of business structure is considered a separate legal entity distinct from its shareholders. It can own property, enter into contracts and carry out transactions in its own name.

Furthermore, the company is owned by shareholders who hold shares representing their ownership. Also, It has directors who are responsible for the management of the company affairs.

In Nigeria, a private limited company can be registered by one individual of at least 18 years. In addition, the requirements for this business structure is that the members must be at most a maximum of fifty and the minimum issued share capital is N100,000.

Finally, it has a major advantage in that the company’s owners are different from the company. This simply means that the company owners are not liable for an act done by the company, and their liability is only limited to the number of shares they own. So, in the event of liability, the owner’s assets are safe.

On the other hand, one downside of this company is that its shares are private, meaning that you cannot trade them on the public stock exchange market.

Public Limited Company

A public limited company (PLC) is like an extension of the private limited company. It is a type of business entity that offers shares to the public and its shares can be traded on a public stock exchange.

This type business structure is most suitable for large companies. Also, it is required by law to publish its financial records annually for transparency and accountability.

Finally, the public limited company can only be registered in Nigeria by a minimum of two adults who can operate it with a share capital of N2,000,000. An example of this kind of business structure is a bank.

Limited Partnership

A limited partnership (LP) is a business entity with at least one general partner (who has unlimited personal liability) and one limited partner (whose liability is limited to their investment in the company).

The general partners are responsible for managing the business and making business decisions to achieve the stated business goals. Whereas the limited partners, are responsible only for investing in the business, and are not involved in managing or running it.

Limited Liability Partnership

A Limited liability Partnership (LLP) is a separate legal entity from its members. Its members only liable for amount of money they invest in the business plus personal guarantees. Consequently, an LLP  has both elements of partnerships and corporations. 

According to Section 746(1) of CAMA, “A limited liability Partnership is a corporate body, formed and incorporated under this Act. It is a legal entity separate from the Partners.”

In addition, an LLP is a hybrid business structure that fuses the features of a partnership and a limited liability company. 

Public Company Limited by Guarantee

This type of business structure is also known as a “non-profit organization or NGO.” Fundamentally, it are registered for the promotion of commerce, art, science, religion, sports, culture, education, research, charity, or other similar objects, and not for profit making.

The business owners have unlimited shares, but the owners’ (shareholders’) liability is limited. For this reason, the business owners cannot sell their shares on stock exchange because they are not in the business for profit.

Private Unlimited Company

A private unlimited company is not a very popular in Nigeria. It is a type of company where its shareholders have unlimited personal liability for the company’s debts and obligations. Consequently, the personal assets of the shareholders can be used to settle the company’s debts when necessary.

Do you want to avoid queries and complications in your registration process? Work with our experts to get your company registered in 48 hours with no complications. Click here to contact our experts.

What Are The Differences Between A Business Name And A Company?

It is a fact that many prospective business owners are not familiar with the different business structures. Consequently, this makes it difficult for them to decide what type of business to run.

Similarly, majority of business owners just want to register a business and get it running. They don’t take out time to know the legal implications of each structure and how it will suit there business.

Therefore, it is imperative that we highlight the key differences between a business name and company registration in Nigeria.

Registering a business goes beyond choosing the cheaper and more convenient option, but choosing what is best for you in the long run.

Business Name or Sole Proprietorship:

A business name, also known as an enterprise or sole proprietorship is the name which a business owner trades under for commercial purposes.

It is best suited for small business ventures, businesses that are not already looking forward to raising capital through the issuance of shares or go large scale. Notwithstanding, a business name can be used to form partnership.

Company (Limited Liability Company)

A company is made-up of individuals coming together for the purpose of doing business and making profit. Upon the successful registration of a business, it becomes a corporate structure or entity with separate personality status.

In addition, it can either be a private or public company. These two types of companies can further be divided into public or private companies:

1. Limited by shares
2. Limited by guarantee or
3. Unlimited.

Differences Business Names and Companies:

• A Business name is easy to register with less formal documentation requirements. While a company has a more complex registration process.
• The law does not make any distinction between the owners of a business name and the business itself. Whereas, a limited company is a separate entity in which the owners are different from the company.
• A sole proprietor under business name raises his capital solely. This is different from the financing for starting a company. A company can raise funding by issuing shares to investors in the company.
• A sole proprietor or partners under business name have unlimited liabilities. Whereas, the liability of shareholders is limited to the amount paid by them during the purchase of shares.

Additional Differences Business Names and Companies Are:

• Decisions are taken by the sole proprietor individually and partners jointly pursuant to the partnership agreement for a business name. On the contrary, decisions in a company are made in meetings by the Board and bounded by resolutions.
• The business of a sole proprietorship or partnership might come to an end on the death or bankruptcy of the owner or partners. This is not so for a company. This is because a company has perpetual existence and doesn’t necessarily get affected by the death of a shareholder or director.
• Business meetings of Business Name have less formal requirement to continue running. Whereas a company is required by law to hold annual general meetings and file annual returns.
• Transfer of ownership is quite difficult under business name as there is no difference between the business owner(s) and the business. While in a company, ownership is easily transferable and the company has continuous existence.
• It is quite difficult to raise capital while running a business name. This is unlike a company where shares can be used as collateral for loans when raising capital.

What Does It Cost To Register A business In Nigeria?

The cost of registering a business in Nigeria depends on several factors like:

• The type of business to be registered
• The State of registration
• The share capital of the company to be registered
• The accredited agents fees

These are just some of the factors to be considered. However, in this post, we will do our best in breaking down the costs to the least. This is to help you have a good understanding of the cost implications of each business type.

Furthermore, it should be noted that this post is written in 2024 and the costs are bound to change with time.

Cost Of Registering A Business Name In Nigeria in 2024

A business name is about the least when it comes to registration cost. This is part of the reason why many business owners opt for it when starting out.

1. Business Name reservation fees – 500 Naira
2. Business Name filing fees – 10,000 Naira
3. Registering Agent Charges – 25,000 to 35,000 Naira
4. Additional commission by online fees processing company – Less than 1000 Naira

In summary, If you are registering a business name by yourself, you will end up spending about 11,000 Naira. Whereas, If an Agent helps you to register, you will pay between 25,000 to 35,000 Naira, excluding the filling fees.

Cost Of Registering A Company In Nigeria in 2024

Company registration cost in Nigeria depends on the type of company. For instance, the cost of registering a private company is different from that of a public company. Also, when shared capital is involved, the cost of registration varies with the worth of the share capital of the business.

Furthermore, companies cannot be registered by individuals who are not accredited agents for CAC. However, you must choose a good and experienced agent to avoid complications in the process.

1. Company Name reservation fees – 500 Naira
2. Registering Agent Charges – 40,000 to 80,000 Naira
3. Additional commission by online fees processing company – Less than 1000 Naira
4. Company filling fees – Not fixed

In summary, it will cost between 80,000 to 250,000 to register a company with CAC.

Below is a list of all the fees charged by CAC. You can calculate what will be required for your own registration depending on the company type.

List of Corporate Affairs Commission registration fees

• The fee of reserving the name of your company – ₦500.
• Fee for registering a private company that has a share capital of less than or equal to 1 million Naira – ₦10,000.
• Fee for registering a private company that has a share capital of more than 1 million Naira and up to 500 million Naira – ₦5,000 for every 1 million Naira share capital or part of it.
• Fee for registering a private company that has a share capital above 500 million Naira – ₦7,500 for each 1 million Naira share capital or part of a million.
• Fee for registering a public company that has a share capital worth 1 Million Naira or less – ₦20,000.
• Fee for registering a public company that has a share capital worth more than 1 million Naira and up to 500 million Naira – ₦10,000 for each 1 million Naira share capital or part of a million.
• Fee for registering a Public Company that has a share capital of more than 500 million Naira – ₦15,000 for each 1 million Naira share capital or part of a million.

List of Corporate Affairs Commission Registration Fees Continued

• Fee for registering a company that does not have a share capital – ₦20,000 Naira.
• Fee for filing of a notice of exemption of a foreign company from registration – ₦30,000. 
• Fee for reinstatement or relisting a company’s name – ₦25,000. 
• Fee for registering charges for a private company – ₦10,000 for each 1 million Naira or part of a million. 
• Fee for registering charges for a public company – ₦20,000 for each 1 Million Naira or part of 1 million.
• To file the annual return for a small company – ₦2,000. 
• To file the annual return for a Private company that is not a small company – ₦3,000.
• To file the annual return for a public company – ₦5,000.
• To file the annual return for a Company Limited by Guarantee – ₦5,000
• To file the annual report of a foreign company – ₦5,000.
• Letter of Good Standing – ₦10,000.
• Other filings (miscellaneous) – ₦2,000.
• Certified true copy of the certificate of Registering – ₦10,000
• Certified true copies of memorandum and articles of association – ₦3,000.
• Electronic Search – ₦1,000 per company.
• Manual Search by customers – ₦2,000 per company file.
• Manual Search Report prepared by officers of the Commission – ₦5,000.
• Certified true copies of other documents – ₦2,000 per document.

Do you want to avoid queries and complications in your registration process? Work with our experts to get your company registered in 48 hours with no complications. Click here to contact our experts.

What are the Benefits of CAC Business Name Registration in Nigeria?

Many businesses downplay the importance of registration. Most small businesses consider the cost implications and decide against it because they see it as a waste of the lean resources available to them.

However, If you are thinking of building a sustainable and growth oriented business in Nigeria, then registering your business is a MUST.

Also, there are many benefits associated with business registration, some of which are highlighted below:

Benefits of CAC Business Name Registration in Nigeria

It Gives Your Business Legitimacy

Business registration in Nigeria is a legal requirement under the Companies and Allied Matters Act (CAMA) 2020. Therefore, registering your business name makes your business a legitimate entity that is recognized by the government. This protects you and your business from legal issues that may arise from operating an unregistered business.

It Is Good For Branding 

A registered business name gives your brand a professional identity. Also it helps to establish your business as a credible and trustworthy entity in the market. Customers are more likely to do business with a registered business. Businesses that are registered gives them them confidence that the business is legitimate and has a long-term commitment to the market.

Ease Of Travelling Abroad For Business

Another great benefit of business registration is that you can easily obtain a visa and travel to any country for business purposes. Every country always welcomes foreign investors who are interested in doing business in their country. This is because such good investments will add value to their economy.

Opening A Corporate Bank Account

Banks and other financial institutions require business registration documents like certificate and MEMART before they can open a corporate account for your business. This is because a registered business name is a legal entity that can enter into contracts and engage in financial transactions. Also, it helps banks to verify the identity of the business and its owners.

Access to Grants and Loans

Many government grants and loans are only available to registered businesses. Registering your business name can help you access these funding opportunities and give you a competitive edge when applying for grants or loans. It is important to note that eligibility criteria may vary depending on the type of grant or loan.

Future Business Expansion

A registered business has more opportunities for expansion and growth. It enables your business to operate in different regions of the country or even globally. This will attract new customers and increase your revenue. It also gives you the legal protection and credibility needed to establish partnerships and collaborations with other businesses, both locally and internationally.

Your Business will Qualify to Bid For Contracts

Business registration documents are required when bidding for contracts government or organizations. This is a compulsory requirement and is legally binding to both parties. It is important to note that contracts entered into by an unregistered business may not be enforceable in court. Therefore, the awardees always avoid such issues.

Qualification for Bank Loans

It is easier to secure loans from banks with a registered business as compared to a personal loan. Funding is critical in any business; and when it becomes necessary to source for it externally, your business registration documents is needed. This is because your company is seen as a legal entity which builds credibility and trust to the banks.

Paying Tax and Filing Annual Returns

Registering your business is necessary for taxation purposes. It enables you to file tax returns and comply with tax laws. when you register your business, you can then get your VAT number and TIN Number from relevant government bodies. A registered business name also gives you access to tax incentives and deductions that may not be available to unregistered businesses.

Gives Credibility and Builds Confidence

A final benefit of business registration is that it gives your potential customers confidence that they are dealing with a reputable business. And when this reputation is maintained, it brings more referrals to the business. Customers and clients, especially people you’ve never worked with before, need assurance that you are a legitimate business.

Do you want to avoid queries and complications in your registration process? Work with our experts to get your company registered in 48 hours with no complications. Click here to contact our experts.

How Long Does It Take To Register A Business In Nigeria

CAC business name registration is easier than company registration. Therefore, registering a company will take slightly longer that a business name.

Consequently, to register a business name takes 24 to 48 hours when you do everything right. But if there are issues in your registration process, it will take 3 to 7 days to complete. Issues can include:

• Filling information that does not correspond to your identity documents
• Uploading unacceptable documents
• Using wrong file formats
• Not knowing the correct sequence when filling the ”village/town/city” in the form and others.

Company registration takes 3 to 7 days if everything goes on well. However, this will take longer if there are queries in the process.

Finally, in order for you to achieve a seamless registration, watch a step by step tutorial on business name registration in Nigeria by Primer Systems.

Alternatively, work with our experts who have over 6 years of business registration experience. They will ensure your registration is completed on record time and you will receive your certificate along with other documents without any hassle.

What Documents Do I Need For CAC Business Name Registration in Nigeria?

CAC business name registration requires far fewer documents than CAC company registration.

Consequently, to register a business name successfully with CAC in Nigeria, you will need the following documents:

• Valid identity card (National Drivers License, Voters Card, NIN registration slip, and International Passport)
• Digital copy of your signature
• Passport photograph
• Two names for your business for name reservation
• Proficiency Certificate if your object is a professional one or Consultancy
• Approval note for name Reservation from CAC
• Payment receipt from CAC
• Stamp Duty Certificate from FIRS
• Residence Permit (for Foreigner shareholders)

With the above, you can successfully register your business name with CAC in Nigeria.

Documents needed to register a company in Nigeria with the CAC are as follows:

• Notice of the registered address of your business 
• Memorandum of Association
• Articles of Association 
• Particulars of the company secretary (this is optional for a private company in line with CAMA 2020).
• The objects and business of the company must be provided. 
• Statement of compliance by a legal practitioner
• The registered address of the proposed company
• Email and phone number of the proposed company
• Forms of identification such as International Passports and driver’s licenses of the directors/ shareholders.
• Approval note of name reservation from CAC
• Director(s) & shareholders(s) full names, residential address, occupation and date of birth.
• Objects of the company
• Details of the company secretary (mandatory for only a foreign-owned entity)
• Particulars, lists, and consent of the first directors of your company.
• Incorporation certificate and company resolution where another registered company (either local or foreign) will be a shareholder or subscriber to the proposed company.

Do you want to avoid queries and complications in your registration process? Work with our experts to get your company registered in 48 hours with no complications. Click here to contact our experts.

CAC Pre Incorporation (Step-by-Step Procedure on How to Register A Business Name in Nigeria)

Public Search for Availability of Business Name

Step 1: Visit CAC website for business name registration.

Step 2: Read the page information. Locate “click here” link In item no.1 and and click on it.

Step 3: The page that opens shows the four steps for business name registration. Click on the first one that says “Public Search.”

Step 4: Type in your chosen business name on the next screen and click on search.

Step 5: Click on the “Business name” tab to reveal the results for business name.

If the search results reveals a name that is close to the one you choose, then there is a good chance that it will be denied. In this case you should choose another name and repeat the process. But if the result returns a reply that says “record not found,” then the name you choose can be used for the business name.

It is now time to proceed to step 2 of registration which is “Reserve A Name.”

Reserve A Name

In order to reserve a name, go back to CAC pre-registration portal and carry out the following steps:

Step 1: Click the “Reserve a Name Now link.”

Scroll down to where you have the “sign up” on the page that appears and click on the link.

Locate “NIN Details” and enter your phone number or NIN number in the appropriate form field and click next.

After clicking next, the profile registration page appears. Fill in the profile ACCURATELY. Note that any mistake made here will affect you when you are reserving a name or filing for registration.

This is where you will also enter your email address and password.

Step 5: When you are done filling the form, go down to where you have means of identification. Select the correct identity card type that you want to use. Type in the ID card number on the field at the right hand side. When you are done, click register.

You will get a confirmation notice that your account has been created successfully. The notice will also prompt you to verify your email address.

Step 6: Go over to your inbox and open the mail from CAC, Click on the confirmation link to confirm your email.

This will open a page that show you have successfully confirmed your email address. With that you have successfully created and verified your profile with CAC.

More Steps…

Step 7: In order to proceed, navigate back to business name registration login page . Click on the email tab and type in your correct email address. Check the “I’m not a robot” check box and click submit.

Step 8: Enter your password on the next screen that appears and click “login.” This will log you in to the Corporate Affairs Commission, CAC portal and you will see your dashboard.

On your dashboard, click on “new name reservation.”

Step 9: This will open a page with four tabs:

1. Name and Type
2. Objectives
3. Preview
4. Payment

Click on the “Name and Type” tab and fill the details of your business as follows:

Classification – Business Name,
Specific Type – Sole Proprietorship
Proposed names – Enter two names that you want your business to be called. The first name should be your preferred name.
Click on “Save and continue” to proceed to the next tab.

Step 10: The Objectives tab is next, fill it as follows

Reason for availability search – New incorporation/registration
Nature of business category – Select the one that best fit your business from the drop down arrow
Specific nature of business – Choose the best fit for your business from the drop down arrow

Click “save and continue”

More Steps…

The next page is the preview page. This is where the information you have filled will be shown for you to preview and make corrections if there are any.

Go through the information. If there is any correction to be made, then hit the back button to take you to the previous page. Also you can click directly on the you want to make the correction.

When you are satisfied with everything, click on “save and continue” to proceed to the payment tab. On the payment page, select pay via Remita.

The next page is a confirmation page for Remita. Here, you will see the total of the amount you are to pay. Simply scroll down and click on “submit.”

This will open a light box pop up for you to make your payment. There are several payment options, but the best one is to pay with your debit card. This process is automatic and your payment is instant.

Select the “pay with card” option, fill in your details and click on “Pay.”

More Steps…

What follows next will depend on your bank. You can either get a screen for you to put your debit card PIN or you will get a screen for one time password OTP. Irrespective of the screen you get, simply follow the prompts and complete your payment.

After a successful payment, you will get a “successful payment” confirmation screen. After this, it will automatically redirect you to the CAC portal where you will find a button to download your receipt.

With this you have successfully completed your business namThe next thing is for you to wait for a couple of hours and then check back in your dash board. If you did everything well, one of the names you submitted will be approved for you.e reservation.

Apply For Business Name

When your business name reservation is approved, the next thing to do is to apply for business name.

Log in to your profile on CAC portal. If your business name was reserved, you will see the “reserved” link display a number. Click on the “reserved” link.

The reserved link opens the approval history page. “Click on start registration.”

This will take you to the registration page. The page consist 6 tabs of forms to be filled.

1. Business details
2. particulars of proprietors
3. Nature of busness
4. Document Upload
5. Preview
6. payment

How to Fill the CAC Pre Incorporation form

Business Details: This form is similar to the profile registration form you earlier filled. Provide accurate information while filling the form to avoid queries. Click on “save and continue” to proceed to the next page after filling the form.
Particulars of Proprietors: The particulars you used while filling your profile is automatically applied here. Click on “add individual proprietor” to add your partner. Fill in your partners details. Click “save and continue to proceed to the next page.”
Nature of Business: Click “Add nature of business” button and fill the form accordingly.
Document Upload: Documents required for upload are – means of identification, signature and a passport photograph. Upload soft copies of these documents using the required file format.
Preview: The next step is to preview the the information you provides. Check and make corrections if any.
Payment: The sum of 10,000 naira is require for the submission of your CaC business registration form. Follow the same process during name reservation to make your payment.

Check back to your dash board and you will see a number on the “pending approval” link. This brings you to the successful filling of the CAC company registration form. Wait a couple of hours before checking back in to see if your registration is approved.

Downloading Your Registration Documents

Log into your CAC business name registration portal. Click on “Registered” link on the dashboard. This will take you to “Approved Registration” page. Locate “Download Documents” button, and click on it. Download your business name registration certificate and the status report document. Save in a good location on your computer or phone.

Note: The sum of 5000 naira will be charged for the download of each document by CAC after 7 days of approval. Also, Your certificate carries your business registration number.

Conclusion

Registering your business name in Nigeria has never been easier. In this post we have taken you through a step by step procedure on CAC business name registration.

We started with the CAC pre incorporation steps like: creating a profile, reserving a business name, filling for registration and downloading your registration documents.

In addition to this, we answered some common questions about business registration in Nigeria. Questions like:

• What is the cost for registering a business in Nigeria
• How long does it take for a CAC business name registration to be completed?
• What are the benefits of registering my business in Nigeria?
• Can i register a business by myself or do I need a lawyer?
• What are the differences between a business name and company?
• How many types of business registration are there in Nigeria?
• What documents do i need for the registration?

In conclusion, we will proudly say that this is the most comprehensive writing on business registration in Nigeria. In our next post, we will write on how you can register for your Taxpayer Identification Number (TIN), using your registration details. Thank you for reading.

Do you want to avoid queries and complications in your registration process? Work with our experts to get your company registered in 48 hours with no complications. Click here to contact our experts.