A registered business gives you legal permission to trade as a businessperson, as well as reassures potential clients and investors that you are not a fly-by-night operation. Additionally, registering your business grants you access to legal and financial frameworks that can help you improve and safeguard your activities. You can, for example, open a bank account and borrow money through an overdraft or a loan. When your company is registered, you can pay and claim VAT, sell shares in your company, and approach investors, and you are protected by particular acts and legal instruments, among other things.
Registration steps
This article highlights the step-by-step process of registering a company in Namibia
Choosing business entity
Decide what type of business entity you want to register as the first step in registering a business. Whether you intend to profit or not will determine this. A Defensive Name (single proprietorship), a Closed Corporation (a CC), or a business can all be registered.
Types of business entities
There are several distinctions between the sorts of businesses, but the following are the most important
Sole proprietorship
It is sometimes known as a defensive name and is essentially a one-man operation. The owner is in charge of the company’s finances and receives all profits. However, if the firm fails, the owner is responsible for all debts made by the company.
CC or Close Corporation
With this, you can have 1-10 members who own and administer the corporation. Their interest in the CC is shown as a percentage, thus you can have a 25% or 50% stake in the company. The legal liability is low.
A company
This is a complicated corporate structure that functions as its legal entity. Shareholders are the company’s owners. A private company can have as few as one shareholders and as many as 50, whereas a public company can have more than 50. A Section 21 corporation is a non-profit organization.
The sort of business you register will be determined by whether you plan to generate a profit or not, as well as the number of owners. Before registering a business, it is recommended that you speak with a legal or financial professional about the advantages and disadvantages of each business type. Some businesses kinds need you to provide financial statements regularly, which can be an additional financial strain for a small firm.
Choosing a business name
Once you’ve determined what form of business you want to register, you’ll need to choose a name for your company. You must register your business name to ensure that no one else can trade under the same name as you. The Business and Intellectual Property Authority of Namibia (BIPA), an institution under the Ministry of Industrialisation, Trade, and SME Development, can reserve a business name (MITSMED). This procedure can be completed in person at any BIPA office or online at www.bipa.na. To avoid applying to reserve or register a business name that already exists, one might search the BIPA website to see what business names have already been registered. Applications for name reservations typically take 3 days to process if everything is in order. Certain names, depending on the nature of the business you wish to run, may require clearance from other stakeholders such as NAMFISA for financial institutions, NEAB for real estate enterprises, and NTB for tourism businesses before they can be registered.
Application to BIPA
After the name has been approved, you can apply BIPA to register your business under the name that was reserved for you. The approval of a business name is valid for 60 days, giving you enough time to register your company.
Filing the application forms
You must fill out the appropriate forms and attach the required supporting papers depending on the sort of business you are registering. There are various forms for various types of enterprises (e.g., Defensive Name, CC, Company, etc. ), however the typical attachments to the forms are usually:
- Identification of owners or shareholders, as well as witnesses (foreign passports require a sworn declaration under oath)
- A copy of the name reservation approval
- The required application forms for each type of business
- In the case of CCs, an original consent letter from an accountant
- All members/directors and witnesses’ cell phone numbers
The opportunity to submit company applications online is not accessible at the time of writing. However, BIPA is working on a project with MITSMED that will result in the implementation of such an online functionality soon.
Employee registration
You will be required to register your employees with the Social Security Commission after your business is registered. You will also need to register your company with the Ministry of Finance for tax and VAT purposes. It’s critical to speak with an accounting or auditing firm to learn how tax and VAT function and whether they’re necessary for your company. Keep in mind that some types of businesses are required to submit financial statements to the Ministry of Finance regularly. This obligation may place an additional financial and human resource strain on your company.
Annual dues and returns
Finally, if you formed a corporation or a limited liability business, you will be obliged to file annual returns and pay annual fees. A company’s annual returns are filed with BIPA’s Registrar of Companies after each fiscal year. The Companies Act of 2004 and the Close Corporations Act of 1988, are legal criteria.
