Registering a business in South Africa and becoming compliant with the full range of laws and regulations can be a daunting task. Research has shown that opening a business in South Africa is far more difficult than in most other countries, even though the government expresses the need for more entrepreneurs.
Do you need to register a business? Contact the Tax Shop is the first answer that comes to mind as this will help you get your dream off the ground without all the frustrations associated with doing it yourself. We’ve explained the process below to give you an idea why it may be necessary to contact The Tax Shop if you need to register a business.
Register with CIPC
You have no fewer than five options for registering your business with CIPC, which is the Companies and Intellectual Property Commission. You can either register through their website or can go to a self-service point in one of the major cities such as Johannesburg or Pretoria. It is also possible to register your company at selected bank branches or can do so by email. As alternative, you can contact the team of The Tax Shop to handle the registration on your behalf.
If you want to register at the CIPC website, you must first register as a user and then make a deposit or EFT transfer to your online account to cover the cost of registration, as well as the cost for reserving the entity’s name. You will be asked to provide information, such as the names and contact information of the directors or owners, list their country of origin and provide the ID or passport numbers, as well as details such as birth date, contact numbers, physical address, and the date of appointment. In addition, you will need to complete details of the business entity such as when the financial year-end is and the details regarding shares, as well as the entity’s physical address, the website and email address.
If you want to reserve the entity’s name then you will have the option to do so alongside the business registration. Note that you will have to supply three to four names in your specific order of preference. The first one from the top will be chosen if available, otherwise the second one, third or fourth depending on availability and compliance with requirements. Expect to wait about five working days for it to be approved.
You will receive an email regarding documentation that you must supply such as certified ID copies of you as the applicant and all the directors and must be sure to sign the registration form. Once registration is completed you will receive an email and get a link to their site for retrieval of the incorporation documents and the relevant certificate. The process is similar for self-service points.
Get a Bank Account
Your next step is to open a bank account for the business. For this you will need to submit the necessary documents such as certified copies of the IDs of all the directors and the original documents of the company which you obtained from CIPC. You will also need proof of the business address such as a letter from your accountant, landlord, rental agreement or utilities bill.
Once you have registered the business and have successfully opened a bank account you must register for income tax at SARS that is linked with CIPC. SARS will retrieve the information you have submitted to CIPC when you visit them to register for tax. As applicant you must be present and will need to take your ID along, as well as the certificate of registration at SARS and a bank statement, which most probably won’t have a lot of details at this stage.
You will need to register for:
You will need to submit an EMP101e form, which you can get from the SARS office or download from their site. As alternative, contact The Tax Shop for assistance.
The PAYE is the tax that will be deducted from the employee and UIF is your contribution that must be made to the Unemployment Insurance Fund which is specifically allocated to help employees who become unemployed to get relief for a specific period. The SDL refers to the levy you must pay for contribution to training of people to gain a range of work skills. All the above registrations are compulsory.
VAT registration is needed once your business generates over 1 million South African Rand. As can be seen it can be a complicated process best handled by the experts at The Tax Shop.