Achieving success in business in Nigeria requires more than just having the required capital, first, you will need a very solid business idea and plan, backed up with proper research and planning.
CHECKLIST FOR ESTABLISHING A BUSINESS IN NIGERIA
There are certain things required of a person looking to do business in Nigeria, most important are : Incorporate Local Company before commencement of business- The various business structures allowed in Nigeria are – Registered Business Name, Company Limited by Shares, Company Limited by Guarantee, Unlimited Company (all companies may be private or public), and Incorporated Trustees Joint ventures, partnership, registered business name, company limited by shares, company limited by guarantee, unlimited company (all companies may be private or public), and incorporated trustees.
Register with Tax Authorities and Obtain First Tax Clearance Certificate- Nigeria is a Federal State, and as such all the different levels (Federal, State, and Local) have taxing powers. The Federal Government is responsible for the collection of Companies' Income Tax, Withholding Tax, Value Added Tax, Education tax, Capital Gains Tax and Stamp Duties from corporate bodies and Personal Income Tax from individuals resident in the Federal Capital Territory and persons resident outside Nigeria who derive income from Nigeria. While each State government is responsible for collection of Personal Income Tax from individuals resident within its state.
Open Corporate Bank Account(s) in the name of the Local Company and obtain a Certificate of Capital Importation from the Bank in respect of any imported capital sum.
Apply for Business Permit and Expatriate Quota(for expatriate staff).
Obtain Residence Permits for Expatriate Staff
Register with Appropriate Regulatory Authorities: For companies wishing to operate in certain sectors, specific Nigerian agencies exist set up by the Government to regulate the companies that provide goods and services within those specific sectors such as: Nigerian Communications Commission(NCC), Securities and Exchange Commission(SEC), Central Bank of Nigeria (CBN) etc.
Secure Office Space/ residential accommodation for Expatriate Staff.
Insurance- Getting the required insurance coverage is an important part of setting up a business in Nigeria. There is a number of mandatory insurance policies that businesses have to obtain in order to lawfully operate in Nigeria, such as : Statutory Group Life Insurance, Builders Liability Insurance, Employee Compensation Contribution, Motor 3rd Party Liability.
These are the first steps to be taken by any person wishing to establish business in Nigeria. At the end of the first financial year, the company is required to file Annual Tax Returns. In addition, appoint External Auditors and a Company Secretary.
