How to Register a Company in South Africa - The Step by Step Guide
Company Registration in South Africa - The Step by Step Guide
In this Step by Step guide, we outline the types of business you can register, where and how to register a company in South Africa, and the benefits of company registration in South Africa. getlion, the latest free business application made for the South African entrepreneur by South African entrepreneurs, will guide you through all aspects of your business from start to success. Download the getlion application on IOS or Android for free today!
All business ideas start with that little fire of an entrepreneur within all of us, but as the saying by Helen Keller goes – “Ideas without action are useless”. So what is the first step in taking action with your new-found business fire in your belly? The answer is simple – register that business and taking action.
Once you have done all you needed to do to get to this point, i.e. business idea, plan, funding, and budgeting, it is time to dive in and become legitimate. Before you can register a company in South Africa, you first need to understand what type of business structure your business is and register it accordingly (yes there are different types, but don’t worry, that is why we are here).
Types of Businesses you can Register in South Africa
There are various types of businesses, but to start we will be focusing on four common structures of businesses you can register in South Africa and what they entail:
1. Private (Pty Ltd):
Simply put, Pty Ltd is a company that trades for profit and is a separate legal entity that is unique from its shareholders.
2. Public (Ltd):
Public company is a business that issues securities through an initial public offering and trades its stock on at least one stock exchange, like the JSE in South Africa.
3. Sole Proprietorship:
This business structure is when there is a single founder who owns and runs the business, and there is no legal distinction between the owner and the business. Here, the owner is the business and assumes all the risk.
4. Non-profit Organisation:
A type of business that uses its profits for charitable purposes and members do not receive profit of any form.
Within those common company structures, you should be able to see one that easily appeals to your business idea, thus making registration that much closer! Registering a (Pty) Ltd is the most popular course of action for new entrepreneurs in South Africa, as it holds legal, tax and administrative benefits over alternatives in most instances.
Where to Register a Company in South Africa
In recent times, it may have been hard to register a business due to inflated associated costs, as well as various middlemen entering the fray to try and nab a slice of “business pie” for themselves. This, however, is a thing of the past, with the introduction of CIPC and Biz Portal, to revolutionise business registration in South Africa. The portal provides South Africans with a safe and effective way to register a company online in South Africa, without the need for business “vultures” or middlemen circling overhead.
What is CIPC and Biz Portal:
The Companies and Intellectual Property Commission (CIPC) are responsible for the registration of companies and cooperative and intellectual rights in South Africa. Biz Portal, however, is the new one-stop, one-day business registration website developed by the CIPC that South African entrepreneurs have been hoping for. Biz Portal offers company registration and related services through an effortless, digital platform, drastically reducing the cost of registering a company (if you had to use a law firm for instance) and of course, nullifying the dreaded delay of registration.
What you will need to register your company:
• Type of company that is being registered;
• List of four proposed names for the company being registered;
• Who the director, or directors, are and personal information such as identification numbers, marriage certificates, spouse’s identification number, and addresses;
• Internet connection;
• Cheque or credit card to make payment of R175.00 for the whole registration process.
Below is a step by step guide to the registration process:
Step 1: Register an account
Register an account on the Biz Portal Website to gain access to the application form for registering a newly founded company.
Step 2: Terms and Conditions
Read through the terms and conditions of the Companies and Intellectual Property Commission, as well as the Unemployment Insurance Fund. Do not agree to the terms and conditions if something is not clear to you. You should understand the terms and conditions completely, and if not, request assistance from a qualified legal advisor. Once you are confident with your understanding of the T&C’s and agree, you must accept to proceed.
Step 3: Choosing Company Structure
On Biz Portal, there are only two options to ease the choice of a company structure, with only a Private company and Non-Profit being listed. Choose the correct structure for your company to proceed.
Step 4: Director or Directors information
The private company requires a minimum of one director, whereas a non-profit organization requires a minimum of three directors. You will be required to key in the identification numbers of the directors of your company along with other information such as marital certificates, spouse’s identification number, and addresses.
Step 5: Company details
Following the director’s information, the company’s details will be required, such as the end of the business financial year, the number of shares made available, and the physical address of the business.
Step 6: Company naming
Here you will be able to give four possible names for your company and these will be checked by the CIPC to ensure that they are not already in use. Once approved, the official company name will be given to you, but one can register a company without a name using the registration number as well, should you not be able to decide on a name right away.
Step 7: Employees
If your company has employees, here you can apply for the compensation fund and the Unemployment Insurance Fund. Followed by the Broad-Based Black Economic Empowerment certification application, should you want to register your business for this.
Step 8: Bank Account
Hereafter you will be asked whether or not you want to open a bank account or if you want to do this at your local branch.
Step 9: Payment
The last thing to do is to pay the R175,00 registration fee to the CIPC account to confirm and complete your company registration.
Step 10: Tax registration
Newly registered companies are instantly registered with the South African Revenue Services, as soon as business registration is complete. Tax clearance certificates can only be applied for at SARS.
Benefits of Company Registration in South Africa
In South Africa, there are various benefits of registering your business including business name protection, tax incentives, financial assistance, and business compliance. It also gives your customers an extra reason to put trust in you and of course, as pointed out in our previous guide, financial institutions do not give business loans to unregistered companies.
Businesses can be quickly and easily registered via the getlion app (One of the Best Business Apps in 2020), thanks to our link with Bizportal. This option cuts out the middleman and saves you money. When you register a company in South Africa using this method, you will be registered via the CIPC and automatically issued a tax number with SARS. With getlion, you have all the information you need to know on How to start business in South Africa, as well as make it compliant, and successful.