Do you know the status of your company on the CAC Portal?
Are you aware so many companies are currently showing as inactive on the CAC portal and might be delisted soon?
(Click this link https://search.cac.gov.ng/home and input name of your company to know your status). You can also chat Grace by clicking the button and she will confirm status.
A few months ago, I was discussing with the Founder of a growing company, and in the course of our discussion, I asked: “do you submit annual filings for your company with the Corporate Affairs Commission (CAC)?” “Sure, we file it every year at the tax office,” . From this answer it was clear that this person had no clue on what Annual Returns entails and that his Company had never submitted its annual returns since it began operations.
From my conversations with business owners, I discovered that a good number of people mistake filing Annual returns with tax filings. This is explains why our focus today is on Annual Returns and how to make your Company compliant.
What Is The Meaning Of Annual Returns?
An annual return is a yearly statement by an active registered business name or company that is meant to keep CAC updated on the company’s activities, composition, and financial position. It is not a financial document, but rather a yearly statement by an active registered business name or company that is meant to keep CAC updated on the company’s activities, composition, and financial position. It also applies to Business Names, Limited Liability Companies and Incorporated Trustees ( Religious organizations, Clubs, Associations etc).
In the case of a Limited Liability Company, the law distinguishes between a small and a large company, and further states that a small company is not required to produce full and proper accounts as huge companies are. In the event of a small business, a statement of affairs, which is essentially an abridged report, would suffice.
Why Is It Necessary For A Business To File Annual Returns?
It demonstrates that the company is still operational and prevents the company from being delisted- The CAC is responsible for the registration and approval of companies and other commercial entities, it follows that it is also responsible for the deregistration and removal of a firm from its register. Clearly, waking up to discover that your firm has been delisted by the CAC on the assumption that it has ceased to run or exist would be disastrous to a fully operational and effective company. This is why submitting annual returns is so important.
When Is Annual Returns Due?
As the name implies, an annual return must be made every calendar year (i.e. annually). A Limited Liability Companies does not need to file its return within the first 18 months of its incorporation.
What Happens If I Don’t File Annual Returns?
Failure to file annual returns, which is a legal requirement, results in a penalty under for each year the company is in default or continues to be in default of filing. The penalty includes the payment of a default fee imposed by the CAC on the defaulting firm and every director or officer of the company.
Also, any post-incorporation filing by the defaulting firm at the Commission may not be processed, i.e., when a company wants to edit anything on its CAC registration CAC would not treat until you have paid all outstanding annual returns and penalties
Furthermore, the CAC may classify the defaulting company as a defunct company, and the commission may remove the entity from the list of corporations.
How Do I Know If My Company Is Still Active On CAC Portal?
In 2020 the CAC introduced the Public Search tool (https://search.cac.gov.ng/home) Which allows you search the database to know if your company is still active. Where your company shows as inactive, it means you are in default of annual returns
How Do I File My Annual Returns?
Before the commission went digital, applicants would have to download CAC Form 10 or obtain it at any of their branch offices, but the online issue resolution has invalidated this method, as such you don’t need to go for an assessment at CAC office any longer. Annual returns is done online by uploading the following documents
• A photocopy of your Business/Company Certificate
• A copy of the Status Report (or BN 01, CAC 7 for companies registered before 2020)
• Valid ID, Address, Phone Number and Email of the Proprietors/Directors.
How Can We Help?
Kudi Konsult can assist you in filing your company’s annual return without issues. To get started, contact Grace now on whatsapp, email or call.
Email Us: firstname.lastname@example.org
Call Mobile: 09034086536 (Available MON- FRI 9am-5pm)