BENEFITS OF REGISTERING YOUR BUSINESS
It is hackneyed that the registration of a business, company, partnership or non governmental organisation is sacrosanct as it bestows a plethora of advantages on the business entity. This article highlights some of these advantages:
- Reservation of your preferred and desired name
Timely registration of your business would prevent another person or entity from snapping up your desired name. For example if you wish to register your company as ‘Emeka, Taiwo and Hassan Ltd.’ and you delay in registering it another person could register his business entity as ‘Emeka, Taiwo and Hassan Ltd.’ and at the point of registration, you would be compelled to select a completely different name irregardless of how long you have been using the name for. To avoid this very common pitfall, it is recommended that you register your organisation as soon as possible.
2. Operation of an official bank account
It is prudent to separate personal activities from business activities. Thus, it is essential that an official bank account be opened and operated for the business entity. In Nigeria, the opening of a corporate account for the business entity requires mandatory registration of the business entity with the Corporate Affairs Commission. It is also pertinent to state that it is highly unprofessional and risky to give a Client personal account details to pay money into.
3. Separate Legal Entity
After incorporation, the business is deemed by law to be a separate legal entity. It has rights and privileges as a human person; it can own property , carry on business under its own name, incur liabilities and sue or be sued in its own name. Incorporating your business eliminates most of one’s personal liability and risks. The extent of your liability would be tied to the number of shares you hold in the company. Your personal assets cannot be seized to repay the debts owed by your incorporated business and you cannot be held responsible for the debts unless you personally guaranteed the debt.
4. Equity Financing / Access to Loans
Investors and money lenders would be more attracted to invest in or lend to a registered business than its unregistered counterpart. Thus, it is imperative to register your business to be able to attract potential investors and enable money lending institutions to be willing to lend to increase the growth of your business.
5. Enhance your Status and Reputability
It is trite that registration of your business would enhance the status of your business and its reputability. The first impression of prospective Clients would be that your business is genuine and their transactions with you are reasonably safe. This gives your business credibility.