Starting a Business in


Below is a detailed summary of the bureaucratic and legal hurdles faced by entrepreneurs wishing to incorporate and register a new firm in Nigeria. It examines the procedures, time and cost involved in launching a commercial or industrial firm with up to 50 employees and start-up capital of 10 times the economy's per-capita gross national income.

This information was collected as part of the Doing Business project, which measures and compares regulations relevant to the life cycle of a small- to medium-sized domestic business in 189 economies. The most recent round of data collection was completed in June 2013.

Compare Nigeria to 188 other economies.

  • Standardized Company

  • Legal Form: Private Limited Liability Company
  • Paid in Minimum Capital Requirement: None
  • City: Lagos
No. Procedure Time to Complete Associated Costs
1 Reserve a unique company name at the Corporate Affairs Commission

The Corporate Affairs Commission (CAC) Online System was commissioned in June 2005. The system envisaged an online search of unique company names immediately upon the purchase of an e-payment card from an accredited bank. Although this service is widely advertised by CAC, until now the system is not fully operational either because of power fluctuation or because of lack of availability of the pre-paid cards necessary to conduct the online transaction. In most cases, the applicants have to go to the CAC branch office in Lagos (either in Yaba or Alausa) to complete this procedure, where they submit Form CAC 1: Availability Check and Reservation of Name.
5 days NGN 500 application form
2 Prepare the requisite incorporation documents and pay the stamp duty

To prepare the requisite incorporation documents, the incorporators must complete the requisite statutory forms, prepare and print the memorandum and articles of association, and have them stamped by the Federal Inland Revenue Service (FIRS)
7 days 0.75% stamp duty paid on share capital
3 Notarize the declaration of compliance with the requirements of CAMA (CAC 4)

The declaration by the barrister or solicitor engaged in the formation of the company may be sworn to before a Notary Public for a fee of NGN 4,000 - NGN 5,000, or at any of the recognized courts in the country (Magistrate Court, the State High Court, or the Federal High Court) before a Commissioner For Oaths for a small fee of NGN 500 usually chargeable by the respective courts.
1 day NGN 500 at the court; NGN 4,000 - NGN 5,000 with a Notary Public
4 Register at the Corporate Affairs Commission and Pay the fees at the bank desk of CAC

To register the company with the Corporate Affairs Commission (CAC), the following incorporation documents are submitted:
• Form CAC 1: Availability Check and Reservation of Name.
• Memorandum and articles of association, stamped by the commissioner for stamp duties (2 copies).
• Form CAC 3: Notice of registered address.
• Form CAC 4: Declaration of compliance.
• Form CAC 7: Particulars of directors.
• Form CAC 2: Statement of share capital and return of allotment of shares.
• Form CAC 2.1: Particulars of the company secretary.

Incorporation fees are:
• NGN 10,000 for company whose nominal share capital does not exceed NGN 1,000,000, and NGN 10,000 for every NGN 1,000,000 thereafter. Incorporation fees for a company whose share capital exceeds N1,000,000.00 is N10,000.00 for the first NGN 1,000,000.00 and N10,000.00 for every additional NGN 1,000,000.00 or any part thereof.
• NGN 500 incorporation forms.
• NGN 500 for each additional copy of Memorandum and Articles of Association stamped.
• NGN 3,000 for certified true copy of memorandum and articles of association.
• NGN 2,000 for certified true copy of particulars of directors.
• NGN 2,000 for certified true copy of particulars of shareholders. Moreover, NGN 60,000 is the approximate cost of company incorporation conducted by professionals (lawyers, chartered accountants and chartered secretaries) accredited by CAC.
The payment can be done at the bank desk at CAC.
11 days NGN 59,592 legal fees + NGN 500 incorporation forms + NGN 30,000 incorporation fees + NGN 500 for each additional copy of Memorandum and NGN 500 for additional copy of the Articles of Association stamped + NGN 3,000 for certified true copy of memorandum
* 5 Make a company seal

Section 74 of the Companies and Allied Matters Act (CAMA) requires every company to have a common seal. The company is thus mandated to have a company seal by the Companies and Allied Matters Act 1990 (2004) (CAMA) first schedule paragraph 15, which provides a standard memorandum of articles of companies and requires directors to provide a company seal. Such is also the common practice, especially because companies will generally have to register a deed and other official documents.
1 day (simultaneous with previous procedure) NGN 4,000
6 Register for income tax and VAT at the Federal Board of Inland Revenue Department of the Ministry of Finance

The Federal Inland Revenue Service (FIRS) requires the applicant to complete tax registration forms for corporate income tax registration as well as VAT.
The company submits an application letter to the tax authority for a tax clearance certificate and, for income tax purposes, registers at the integrated tax office.
The registration process requires submitting a completed tax office–issued application (taxpayer registration input form, TRIF/2006/001 COYS) and the following documents:
• Completed FIRS questionnaire.
• Memorandum and articles of association (copy).
• Certificate of incorporation (copy).
• Directors’ names and addresses.
• Tax advisor’s name and address.
• Letter of appointment of a tax adviser and corresponding letter of acceptance.
• The date the company commenced business;
• Names, addresses and mobile numbers of major promoters and the chairman of the company, including their email addresses;
• Other sources of income of the chairman and the promoters of the company;
• Name and addresses of the principal officers of the company including the chairman, managing director, legal adviser and accountant;

To register, the company must submit the taxpayer registration input form in triplicate, and the original certificate of incorporation must be presented for review by the controller. Upon the completed taxpayer registration input form and all other documents being received, a tax reference number is allocated. An application must be filed for the tax clearance certificate; its issuance is not automatic.

Fee schedule for tax clearance certificate:
• Registration within 6 months of incorporation: no cost.
• Registration after 6 months of incorporation (if the company has yet to start business operations):
• A pre-operation levy of NGN 20,000 for first-year requests and NGN 25,000 for each subsequent year request, until the company files a notice of commencement of business as per amendment to section 29 of the Companies’ Income Tax Act No. 11 of 2007.
• Companies that register after the start of operations must file a set of audited accounts. TCC is issued based on tax paid for 3 years. If the position is at a loss, the TCC will be issued to reflect the position.

Companies required to register for VAT complete the VAT registration form (VAT Form 001, obtainable free of charge from all FIRS offices) and return it to the integrated tax office, which will issue a taxpayer identification number (TIN). Companies required to register for VAT must do so within 6 months from the date of company incorporation.

Since the registration for corporate income tax and VAT are done in the same place; one Tax Identification Number (TIN) is issued to companies for all federal taxes.
4 days no charge
* 7 Register for personal income tax PAYE at the State Tax Office

All employers shall register with the relevant state tax authority for income tax withholding.
The PAYE Regulations, 2003 made pursuant to the Personal Income Tax Act provides that all employers are to register with the Lagos State Board of Internal Revenue Tax Office nearest to the registered company address for the purpose of remitting income tax deducted from their employees. The employer must within 6 months of commencing a business deduct tax from emoluments of employees and remit the amount deducted to any of the designated collecting banks.

The registration requirements are as follows:
1. A copy of certificate of incorporation.
2. List of staff and their annual salaries.
3. The Directors’ Tax Clearance Certificates (now Electronic Tax Clearance Certificate)
4. Letter of application for registration.
Upon completion of registration, an Employer's Identification Number will be issued.

An employer who fails or refuses to register commits an offence and is liable on conviction to pay a NGN 25,000 fine in addition to the payment of arrears of the tax due.

2 days, (simultaneous with previous procedure) no charge
* 8 Register business premises with the Lagos State Government and Pay the business premises levy at a designated bank

To register the company premises with the Lagos State Government, the entrepreneur heads to any nationalized commercial bank with some evidence of the business premises (utility bills, etc.) and pays the business premise levy to the account of the Lagos Inland Revenue Services (LIRS). The bank then issues a receipt bearing the Lagos State Government logo.

Business premises in an urban area of Nigeria are required to be registered on the payment of a NGN 10,000 registration fee in the first year of registration (NGN 5,000 per annum as renewal registration fees in the subsequent years).
For rural areas, the business premises registration fees is NGN 2,000 for the first year of registration (NGN 1,000 per annum as registration renewal fees for the subsequently years).
1 day (simultaneous with previous procedure) NGN 10,000 paid at the beginning of first year; NGN 5,000 in subsequent years
* Takes place simultaneously with another procedure.

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