Navigating the legal landscape is crucial for entrepreneurs and small businesses in Nigeria. Staying compliant not only helps you avoid penalties but also fosters business growth and builds credibility. Here are some key compliance tips to guide you on your journey:
- Register and Incorporate Your Business with the Corporate Affairs Commission (CAC):
Under the Companies and Allied Matters Act (CAMA) 2020, you are required to register your business name with the CAC if it includes anything other than your true surname, or true surname and forenames, or true surname and true initials. Non-registration could lead to fines and loss of exclusivity over your business name.
You should ensure your business is registered before beginning operations. Fortunately, CAMA allows for single shareholder companies.
- Obtain Relevant Licenses and Registrations
Did you know? Courier companies need a courier license from the Nigerian Postal Service. Also, cybercafes must register with the Computer Professionals’ Registration Council under the Cybercrimes Act, 2015.
Research what registrations, licenses, or permits are required for your business and get them to avoid legal issues.
- Stay on Top of Your Tax Obligations
In Nigeria, all businesses must register with the Federal Inland Revenue Service (FIRS) for taxes such as Value Added Tax (VAT). Keeping accurate records and timely payment of taxes is crucial to avoid penalties.
Not sure where to start? Consider working with a tax lawyer or consultant to help ensure tax compliance. They might even find you some tax incentives!
- Get Insurance:
Insurance is not only a good idea, sometimes, it is lawfully required. For instance, businesses conducting taxi services are mandated to have at least third-party insurance under the Amended Regulation for Online Hailing Business and Taxicab Operation in Lagos State, 2023.
- File Your CAC Returns
Filing annual returns is mandatory for all incorporated companies according to CAMA. Not filing these returns can result in monetary penalties or even getting struck off the register.
There are penalties for incorrect and late filing. It is the duty of your Company Secretary to ensure your annual returns are filed accurately and in a timely manner.
- Protect Your Data
With the rise of digital businesses, data protection is more important than ever. The Nigeria Data Protection Act (NDPA), 2023 requires businesses to safeguard personal data and privacy. This means implementing data protection policies, obtaining consent for data collection, and preventing data breaches.
Why does it matter? Compliance with NDPA not only keeps you out of legal trouble but also builds trust with your customers.
- Comply with Labour Laws
Labour laws in Nigeria include areas such as employment contracts, minimum wage, and termination procedures. Businesses are even required to contribute to the Employees’ Compensation Fund (ECF) to cover work-related injuries under the Employee Compensation Act, 2010. Review your employment contracts and policies to ensure they comply with current laws.
Adhering to laws that impact your business is an essential part of running a successful business in Nigeria. Compliance protects you from fines and builds credibility with customers and investors. However, keeping up with evolving legal requirements can be challenging and requires a proactive approach. This is why it is necessary to have a trusted legal partner who understands your business and can provide the guidance you need.
At Syntax Legal Practitioners, we help entrepreneurs and small business owners navigate these complexities.
Our services include legal health assessments, advice on licenses and registrations, insurance and data protection guidance, and provision of tailored compliance trackers to help you stay on top of filing deadlines and regulatory changes. These solutions are designed to manage the legal aspects of your business, so you can focus on what matters most — growing your business.
Contact us today to learn how we can help you stay compliant and succeed in Nigeria’s dynamic legal climate.
Syntax Legal Practitioners 