How To Register A Small Business In South Africa

South Africa desperately needs citizens to start small businesses to help combat the country's high unemployment rates. Starting a small business is no easy task, and for the average person, knowing what legal obligations and paperwork are needed to own a business can feel daunting and off-putting. 

The first step in starting a business is to choose a name and register it with the Companies and Intellectual Property Commission of South Africa. Registration reserves your name and makes you the official entity that can trade under that name in South Africa.

If you're looking to register your small business or startup in South Africa, you can find a step-by-step guide on how to run through the process so you can start trading.

Register as a customer at CIPC

As mentioned earlier, you need to register your company with the CIPC and to do so, you first need to register with them and become a customer. Here, you will need to register your details (the owner/director of the company) and have a CIPC customer code to facilitate the process.

Choose and reserve your company name

Once you have a CIPC customer code, you will need to carry out a name search with the CIPC's database to be sure that no other company bears the trademark or name you want to use. The CIPC does not charge business owners to search for patent information as long as they have registered on the leading portal to access CIPC's online services.

Once you are sure the name you want to trade with has not been reserved or is already in use by another trading company, you can start the name reservation process.

The CIPC charges for the manual registration of the company's name, but it can also be filed electronically on the online web portal.

The CIPC will then check your application against its database to ensure there are no discrepancies or duplicate names. The application process can take approximately three days to reserve the name until it is approved.

Once approved, the name registration will be valid for six months.

Check for name availability

You will need to file for a company name that will identify your business in the Memorandum of Incorporation (MOI).

You may choose to register a name by registering the company first using your name and file for registration of the name later, or reserve the business name and then initiate the company incorporation process after that.

If your name reservation application failed

If your name reservation application was not approved, you would need to apply for new names, so be sure to provide several options to ensure a better rate of success.

You may apply between one and four names during each application process. Name registration may vary for a private company and a non-profit company registered without members, so be sure not to waste your money with multiple application submissions.

Register your company

You will need to deposit your funds for company registration without a name reservation or the full amount for company registration with a name reservation into the CIPC bank account. At the time of registering a company, you need to be 18 years or older. Once your funds are cleared, or you're paying with a credit card you can proceed to submit your registration.

To complete the company registration process, you will need the following supporting documents:

• A certified copy of the applicant's ID.
• A certified copy of the ID of all the Directors and Incorporators of the company.
• Non- South African applicants need a passport copy as proof.
• The name confirmation certificate (COR9.4), which is an application form downloaded at CIPC.
• Power of attorney (if required).

Once you are registered with the CIPC as a company, it brings with it specific responsibilities, irrespective of whether the business is trading. For example, you will need to file an annual return and pay a yearly fee to retain your name and trading rights.

Do I have to register my business to trade?

CIPC registers Companies and Co-operatives, but It is not necessary for all businesses to formalise by registering with the CIPC. For some businesses, such as informal businesses and sole proprietors, there may not be sufficient benefits.

Businesses that wish to transact with government and the formal sector, or that wish to access certain types of government support, are generally required to be registered with the CIPC. For these businesses, there may also be tax benefits to registration, as registered companies have a lower tax rate than individuals.

Even though you may not be registered with the CIPC, you will still have to be registered with the South African Revenue Services and will always be liable for tax if your turnover exceeds the prescribed threshold.

Does it all seem like too much admin?

As a small business owner, you've got your mind focused on so many moving parts, and admin often takes a back seat. Thankfully, some companies handle company registration admin, support new business owners, and make the application process easier and less frustrating.

If you're looking for assistance in registering your South African business, you may want to contact business registration services like:

• SwiftReg - https://www.swiftreg.co.za/
• Company Partners - https://www.ptycompanyregistration.co.za/
• ELodgements - http://elodgements.co.za/
• 1-Grid - https://1-grid.com/company-registration-south-africa/
• Top Business Registration - http://www.pty-registration.co.za/
• First for Business Registrations Solutions - http://fbrs.co.za/
• Shelf Company Warehouse - https://ptyonline.co.za/
• SMTAX - https://www.smtax.co.za/startup
• Govhain - https://www.govchain.co.za/company-registration
• Import Export Licence - https://importexportlicense.co.za/product/company-registration/

Contact us

If you would like us to help set up your small business website or want to know more about digital marketing for your business, then don’t be shy we’re happy to assist. Simply contact us

Are you looking to promote your business?

South African Business owners can create a free business listing on nichemarket. The more information you provide about your business, the easier it will be for your customers to find you online. Registering with nichemarket is easy; just head to our sign-up form and follow the instructions.

If you need a more detailed guide on creating your profile or listing, we recommend checking out the following articles. 

• How to create a nichemarketer profile 
• How to create a nichemarket business listing 

Recommended reading

If you enjoyed this post and have a little extra time to dive deeper down the rabbit hole, why not check out the following posts about small businesses.

• Free South African Business Directory Sites
• Why South African Businesses Should Blog
• South Africa's Best Business Blog
• 40+ South African Tech Startup Ideas
• Why South African Businesses Should Collaborate More Often

Tags: Small Business