SEC-S20W4 | My Business Ideas | Registration, License, and Taxes

Greetings dear friends, it's week 4 of the Steemit engagement challenge for season 20 and it's a pleasure to participate in this week's entry which talks about Registration, License, and Taxes. Let's go into this exciting discussion together without any further ado.

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Section 1- We are interested to know about the registration procedure of your business in your country and how you manage it.

Here in this section, I will want to share with us a general overview of the process involved in establishing a business in Nigeria my country so read till the end and see how every business in Nigeria is registered. Before you can start a business in Nigeria, you must obey the rules and regulations established by the Corporate Affairs Commission (CAC) a body responsible for business registration in Nigeria.

There are five basic steps you must follow before your business can be registered by CAC and these procedures include the following listed below.

Step 1: Check Name Availability

The first step towards registering a business in Nigeria is the name availability check. A company or individual who wishes to register a business will have to present a proposed name to CAC and this name will be reviewed to be sure that no other business has the name if they are done with their verification they will notify the applicant of their approval i.e. if no business is using the name already.

This name check and approval by the CAC takes about 2 working days and if successful the business registration moves to the next level but if not successful then the company or the person who wishes to start the business may need to bring another proposal.

Step 2: Registration of the Company

Once the name of the company or business has been approved by the CAC, the next step is that the company or business will go ahead to start its registration process this process involves the payment of a certain amount which is not fixed because businesses differ and submission of proposed company or business name and lastly details of shareholder of the business or company.

Step 3: Payment of Stamp Duty & Submission

Another major step after the two listed steps above is the payment of stamp duty. Stamp duty is money paid to the Federal Inland Revenue Service (FIRS) which is a compulsory legal amount that must be paid by any business or company before they can be submitted for registration. Now, after this payment, the CAC still checks the documents of the company and all other information associated with it before they can accept or query the registration process of the company.

Step: 4 Registration and Issuance of Certificate and other Documents

Now after meeting all the above-listed processes the business will be registered and approved by the CAC and also certificate will be given to the business or company to certify that they are registered business in Nigeria. So certificate and incorporation documents are what the business gets at this stage.

The business or company is supposed to go online to the portal of the CAC and download and also print the document as well as the certificate for its business.

Step 5: Registration for Tax Purposes

In this stage, the company goes ahead to register for tax. Registering for tasks is done with the FIRS. When the business or company registers for tax through FIRS, they will get a Tax Identification Number (TIN) which they will need before they can be allowed to open a bank account in Nigeria.

Also, depending on the type of business you wish to operate you may need additional licenses or certifications from other regulating bodies such as the National Agency for Food and Drug Administration and Control (NAFDAC) and others.

Section 2- Tell us all about the procedure to obtain any license/permit etc. to run your business.

As I have discussed in my previous post, the business I'm going into is a loan business which is a financial institution and this means that it must be properly registered. I got the inspiration from the company I worked with which is called Microcima Africa. So since it is a financial establishment it needs to be registered and below I will answer based on the points raised in this question.

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Being a financial institution, my business needs permission/license which means that it doesn't fall under free trade. So the basic steps I have stated above must be followed jealously before my business can start.

One of the major problems I had with the government during the process of registering the business was the high amount of money charged for registration and tax. It is a small financial institution but the bill I was seeing was as though it was a big company that I was about to run. As I stated earlier, the registration fee and tax are not fixed so the members in the CAC and FIRS will sit and then think about what you will be making shortly and then use that to extort money from you.

Seeing the outrageous amount of money called to me during the registration I had to go back and then come with my lawyers and other people to help and then reason with the government to reduce the amount they have levied me to pay.

Getting the license was never an easy task, as I explained earlier above, it takes 2-5 working days usually before you will get feedback on any review by the CAC or FIRS but in my case, it took longer because according to those in the office, many requests needed to be handled before they can handle mine.

So the permission I was supposed to get within 2 weeks took me almost a month before I got it. However, it finally came after much struggle and debate as those who were in charge needed me to sort them before they could hasten the task which I wasn't aware of that.

Section 3- What is the tax structure for traders/manufacturers

The tax structure for traders/manufacturers in Nigeria is not always stable but based on this task, I will list and explain some necessary taxes that every trader must pay once his or her business is registered. Some. of these tax was not mentioned during registration as they are paid only by a running business.

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Now, it is important to mention here that Nigeria is a very big country and it is divided into states for that reason, each state governor brings their rules or regulations with regards to payment of tasks. Hence task payment in Nigeria varies from state to state.

In my business as at the time of writing this contest is not left out and the tax associated with it is what I will be using for my explanation. So let's get started.

One major task associated with my business is the Value Added Tax (VAT), usually 7.5% of services rendered, Company Income Tax (CIT) which is usually 30% of the profit generated in the business, Withholding Tax (WHT) which is usually between 5%-10% of the various transactions carried out by the business Stamp Duty & Territorial Development Tax which is usually 0.5%-2% on any documents and the region your business is located respectively.

As stated already Company Income Tax (CIT) which is usually 30% of the profit generated in the business is where we see a lot of changes because it deals with what you will have to pay If the profit you are now making is higher than the one you have made previously.

So if your current profit generated is much higher than the way it used to be, you will have to pay more though it is always 30% whether the profit increases or not. If it increases, it means they will have more money but if it decreases they will also have less money.

Tax rebate as we already know is the refund of excessive tax which has been paid by an individual or a business or company. Excessive tax can be due to overpayment, change in tax rate, or errors in tax calculation. So if you find yourself in any of these situations you will be entitled to a tax rebate.

The best way to file a tax rebate is to apply for it. Knowing that you are in one of the above-listed categories, what you will do is apply to CAC or FIRS which will then check your request and be sure that what you have applied for is the way it is.

Once they are satisfied with your application they will go ahead and process your request and the money will be sent back to your account without any stress.

Section 4- What are the options in case you face any tax-related problems?

If I should face any tax related problem today in my business, I won't go ahead to solve it myself because I don't have the required knowledge to do so but what I will do is to go ahead and consult a professional in the field who will guide me on the steps to follow so as to get my problems fixed.

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When you know your right, you have a reason or reasons behind what you are chasing after then it becomes very easy to get that thing you want. If you don't know how to follow up your problems then you may find it difficult to achieve your goal and that is why I will implore a professional to help me through the process.

Yes, there is a consumer court in my country. This court is there to stand for the consumer rights. At some point in our lives we are all consumers so we need our rights to always be protected and the best place to get this legal protection is via the court which is a legal way.

Let's assume a consumer has an insure with a manufacturer, it is important that the consumer talks the manufacturer to court to gain justice. Recently, here in Nigeria, a popular pastor was selling some soap he tagged miracle soap which can heal the sick and make the blind see and the lame walk, one of the social media influencer bought it and then went ahead to administer it as instructed to the blind and the lame but there was no change in their situation.

This called for a chaos in the land as the consumer sued the manufacturer to consumer court and the till this moment, they are still struggling and debating about the said issue. So they right of the consumer is always protect d by this court and we hope justice will be admitted soon.

In the case of dispute between businesses and consumer, I can't say anyone has more upper hand and this is because they all have their points of view but when any of them fails in their duties then the other has an upper hand. As a consumer I can even say the consumer has higher hand when it comes to dispute between the business and consumer because as the popular saying always goes that customers are always right.

So if customers are always right then I think they have upper hands when it comes to dispute between businesses and consumers. So every business will always want to bend to the customers ways because they are serving the customers.

Yes, Nigeria has a fair trade policy which they always ensure that the consumers and the business owners are satisfied with it. Product prices are always regulated so as to avoid extortion and also that the business will not suffer lost there by making it to wear out with time. So to be on a safe side everything is always balance.

I want to finally invite @josepha, @solaymann, and @suboohi to join the contest and share their entry if they haven't done so yet.

Cc:
@dove11
@aviral123