PROTECTS YOUR NAME: The moment you register that name with the CAC you are certain that no one would take that name and if the name is given to someone else, you would easily write to CAC informing them of the mistake.
GIVES YOUR BUSINESS A CORPORATE IMAGE THAT IS DIFFERENT FROM YOU: This does two things, the first is that it helps people see your brand independently. secondly, it protects the business owner from being personally liable.
TO ENABLE YOU OPEN A CORPORATE BANK ACCOUNT: this is really important for your online business because most customers are wary of sending money into personal accounts to avoid being defrauded. Secondly, having a corporate account, helps business owners manage their revenue and build their businesses.
IT IS AN OFFENCE: It is an offence in Nigeria to run a business for more than 28 days without registration. It attracts imprisonment or fine of N150 for every day of offence.
LIMITED BUSINESS GROWTH: most corporate organization and individuals, would refuse to do business with an unregistered business which would greatly limit the growth of that business.
INABILITY TO OBTAIN LOANS AND OTHER BUSINESS INCENTIVES: Depending on the industry you operate in, you might be entitled to a lot of incentives for perpetuating that business. For instance, there are a lot of low interest loans for agricultural companies, tax holidays for a lot of companies, some of these companies gets as high as 7 years tax holidays. However, only registered businesses can benefit from these incentives. so you cannot benefit from these incentives
TO PROTECT YOUR PARTNERSHIP: Where a business is a partnership, that is, you are perpetuating it with your friends or some other people, the moment your register, the partnership automatically has some rules and regulations to guide your relation ships however, where you refused to register, you have nothing and where one partner takes advantage of the others, you guys have nothing to protect you.
NO SUCCESSION PLAN: An unregistered business dies with its owner as there is nothing to continue.
DISCLAIMER: Please note that this article is for general information purposes only. These articles do not and are not intended to constitute legal advice based on any information provided in this article. Please consult with your own legal counsel on your situation and specific legal questions you have. The information provided in this article is not privilege and does not create an attorney-client relationship with STARR ATTORNEYS or any of the firm’s attorneys, nor does the transmission of comment or an email create an attorney-client relationship.
