Blessed with resources, this country has a strategic location that makes doing business favorable to foreign investors. Choosing a legal business structure can be a difficult decision for business owners to make. As a right choice ensures better security of personal assets, higher chances of obtaining business loans, and favorable tax services. The business structure options available here are a) Limited company (SA), b) Limited liability company (SARL), c) Simplified joint-stock companies (SAS), d) Limited partnership (SCS), and e) Cooperative society.
If you are looking to incorporate a company in the state, this article provides information on the different types of business entities existing within the African nation.
Limited Company (SA)
This form of corporation is popular in the territory. It requires smaller investments, with at least two shareholders. All share capital has to be evenly determined by shareholders. It should be noted that they are all liable for the share capital contributions. All income the company makes is distributed to shareholders based on their shares.
Limited Liability Company (SARL)
Already existing businesses may file additional documents to become a Limited Liability Company (LLC) to acquire some level of legal protection. An LLC encompasses the same taxation as a partnership with the limited legal liability of a corporation. A business owner running this entity would only pay certain types of taxes.
Simplified joint-stock companies (SAS)
These corporations require larger investments, hence it involved many people. Although it has a rigid structure, it allows great flexibility. The share capital is to be divided into shares which may be nominative or bearer shares. Asset liabilities of shareholders are based on the value of the shares.
Limited Partnership (SCS)
A partnership is similar to a sole proprietorship, but in its case, there are two or more owners. Every partner contributes money, labor, skills, or property to the business as they deem fit. Since it has no liability, the personal assets of partners are not protected and may be used as collateral in court. There should be a board of directors amongst the partners.
Cooperative society
This type of entity applies to persons looking to contribute money monthly without actually doing business with it. Everyone in society contributes an evenly determined amount that has to be paid timely. At the end of the month or year, as agreed in the article of association, every member receives their profits.
Setting up an Entity
Irrespective of the form of company you wish to set up, the process of registering a business involves the following steps listed below:
Certificate for the business name application
You have to ascertain if the desired business name is available. If it is, you will be issued a certificate to prove your ownership of the name.
Payment of the registration fee
Registering a company requires filling out a form you will have to pay for.
Articles of association
Hire the services of corporate lawyers or legal experts to prepare the company’s article of association.
Filing the company’s tax ID
Register for taxes with the department and acquire a business tax ID number for future tax returns and tax payments.
Notarise Business documents
Submit and notarize all business documents to ensure their authenticity.
Register for Social Security
Ensure to register yourself and all employees for social security contributions and insurance.
Obtain a license or permit
Business owners must apply for licenses or permits to carry out business activities in the state.
Set up a corporate bank account
Business owners must open an account with a locally based commercial bank for all financial transactions. In the case of limited liability companies with share capital, the capital must be deposited in the account created.
