How to Register a New Business in South Africa

By November 4, 2016Prestigio

The Time is Now

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If you have a business plan or idea, you don’t have to wait around till you can afford expensive legal help. Employ your Smartphone instead to register your business, and ‘get it done’. Here’s how:

Prestigio Smartphones & Tablets have all the functionality as desktop computers and laptops. Don’t let a lack of access prevent you from going after your success, you can purchase a Prestigio device today, which is much more affordable than you think, just take a look at these deals. Nurture your entrepreneurial spirit and use your smart device to help you on the road to business success.

Unleash your potential by getting your business registered on your Smartphone.

First Things First

Before you start filling out forms it is important to have formed a general outline as to what service or goods your business will provide. You will need to know and decide if your business will be applying for government bids or tenders. It is also important to have an idea about the amount of ‘profit’ you will be hoping to make. This is important as some rules apply specifically to businesses / companies that make over a certain amount of money or want to solicit contracts with the government.

In South Africa, an individual must first determine what type of business that wish to register as. Each type comes with its own sets of responsibilities, liabilities, and advantages. Simply put they are as follows:

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Sole Proprietor

This is the simplest type of business to start and dissolve as it is owned and operated by an individual person. Business owners must include business income in his personal taxes, assume all the risks and has complete power to make decisions regarding the business.

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Partnership

This is similar to being a Sole Proprietor and is also fairly easy to create. The main difference is that it consists of a business formed by more than one person but not ‘incorporated’.

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Close Corporation (CC)

A legal entity with specific rights and responsibilities. No shareholders but from 1-10 members. These members of the CC are in fact the business owners.

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Private Company

This type of business is separate from the owners, instead managed by a director and up to 50 shareholders. While this type of business makes it much easier to raise capital it is also subject to more regulation. A Private Company is also more costly and involves more ‘admin’ as this type of business requires more legal paperwork.

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Co-operative & Others Recognized Business Forms

Any Association of Persons/Professionals as registered under the act. Small business corporations, Micro businesses, Labour Broker’s, and Personal Service Provider’s.

You must first determine if your company is a for-profit business or a non-profit social project. Under these two categories there are different types of companies that are eligible for registration. These include a Franchise Business, a Non-Profit Company, an Association of Professionals and a Personal Liability Company.

Deciding this will be impacted by your mission statement and goals and objectives. When you have determined what to register under than you must apply for a trading license.

The Companies Act of 2008 made is possible to register a business even if you have not decided on a name yet. When you apply without a reserved name, the process may go more quickly as you are assigned a registration number to use immediately for trading. You can then apply at a later stage to add a ‘reserved’ name to your business.

If you apply from the beginning with a ‘reserved’ name in mind for your business you will need to wait for the commission to confirm that no other businesses have been registered with the name you requested. You are allowed to apply for up to four business names per application.

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The Simplest Way to register a new business

A Private Company with a Standard Memorandum of Incorporation (MOI) can be registered online at CIDC ‘s website using your Prestigio Smartphone. For a legal template of a Standard MOI see this unpersonalized template here.

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Don’t be intimidated by the process! Follow these easy 6 steps to register to register a new business:

  1. First register as a customer and create a valid and unique personal CIPC “Customer Code” by visiting this link. For step by step directions on how to do this click here.
  1. Deposit an initial amount of either R175 (with a company name) or R125 (without name) to begin registration. Use the details found here, and make sure to use your correct customer code as your reference number on payment.
  1. Apply to reserve the business’s name that you want to use for your private company. Go to this online transacting page and click on “Name Reservation”. From here follow the directions to secure the name you want. Your company’s name will have to be original!

          *Standard service delivery time up to 5 days

  1. Register your company by logging on with your Customer Code and password here. Then follow the instructions
  1. After submission you will receive instructions and an email to which you must send ALL Supporting documents needed. These may include the following:

These are the Documents You Will Need to Support Your Application to register a new business:

  • Certified Copy of Your (the applicants) ID
  • Certified Copies of the ID of any other Directors &/ Incorporators
  • The Name Confirmation Certificate (COR9.4) if you are registering with a reserved name
  • If necessary Power of Attorney

     *Standard service delivery time 3 working days from submission of working documents

  1. Track your application status by logging on here and then selecting “Transaction Status”

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Ins and Outs of Tax for a new business:

SARs

When you start a business you must register and receive an Income Tax Reference Number for the new company from the South African Revenue Service. This must happen within 21 days of beginning to do business. The IT77 form to complete can be found here.

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Employing Staff

If people will be hired to work at your business it is important that you follow the SARS rules for small businesses and employment. These responsibilities include registering for PAYE (Pay As You Earn) and UIF (Unemployment Insurance Fund) as well as submitting the Monthly Employer Declaration Form. For more information on levy’s and tax breaks visit the SARS page on employing staff here.

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VAT

According to the South African Revenue Service (SARS) any business with over R1million in turnover is required to register and obtain a VAT number for tax purposes. For more specific information relating to the small business tax obligations here is a link to the latest SARS booklet on the subject.

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Registering Your Business/Company with CIPC

Employ free Apps such as WPSOffice to access and even create multiple types of files.

Once you have completed necessary forms in a legible way with accurate information;

use free apps such as CAMSCANNER to convert a photo of your completed forms into a scanned document on your Smartphone. This will ensure the CIPC receives files as close to 100% size and under 10megabytes in size as they request.

Connect to Wi-Fi or use your data connection to email required files to CIPC specified email address.

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How Much Does it Cost to register a new business:

The application to register your business for trading costs between R125 (for-profit) to R475 (non-profit) and each name you seek to reserve will cost R50.

How Long Does It Take to register a new business

With the new online business registration, the CIPC website states that it ought to take a mere three days from when you gain a receipt for your submitted documents to register your business.

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Prestigio supports your Startup

Providing affordable technology and products along with inspiring & distilled pertinent helpful information is the way we support you to use your talents and skills to succeed.

Our devices come preloaded with everything you need to view, access, edit and develop business’ and registration documents, create your business plan, connect and network through phone, email and more, and design a website to market-hub your business.w

The Entrepreneur as Activist

Positive disruption can be powerful. Immerse yourself in the world at present, study the shifts, think, and participate. South Africa is filled with potential, and her people are the largest representative of that. Exercise your creativity, find the gaps, and get in the game. Don’t wait to make your passion professional and grow its profitability. The sooner you register your business and develop your ideas the better! Don’t just talk the talk, walk the walk with Prestigio today.

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Curious to Learn More? Here are Some Resources of Note

To Note: The above article is not to be taken as Financial Advice, it is merely meant to be informative & entertaining.