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Registering Your Business in Ghana: What You Need To Know

December 22, 2020

Introduction

The establishment of businesses has substantially increased in our contemporary world. Businesses do not operate in a vacuum rather they function within an environment and as such are regulated. Incorporating one’s business is one of the compliance requirements for the purposes of regulation and for identification as a legal entity – Section 12 of the Companies Act 2019 (992). Thus, registering a business in Ghana is the preliminary phase for the smooth thriving of businesses.

However, many Ghanaians and expatriates are challenged with setting up businesses in Ghana owing to the fact that they have little or no knowledge on the processes involved in registering their businesses. The processes and modalities involved in registering a company in Ghana are essential for start-ups as well as multinationals with the intent of starting a business in Ghana. Below are the various processes involved in registering a business (A Company Limited by shares) in Ghana.

Step 1: Decide on a name and conduct a Company name search at RGD

The first stage in registering a company is to decide on the name and conduct a name search to confirm the availability of the anticipated business name for the company. The business name must be expressive, relevant, distinctive, and unique. Business names that happen to be similar to existing names are likely to be rejected by the Registrar General’s Department. Also, the RGD may reject names that are deemed to them as misleading, offensive, undesirable, or violates existing trademarks or business marks. As such, it is prudent to submit alternative company names. A reserved name is valid for a period of 30 days. A company limited by shares must have a name that ends with either “Limited or” “Ltd” at all times unless special permission has been sought. For instance, using the word “corporation” in your company name will be considered misleading by the RGD as it is reserved for only government-owned companies.

Step 2 - Attain a Tax Identification Number for all members (Shareholders, Directors, Secretaries)

All members of the company including shareholders, directors, and secretaries, are mandated to obtain a Tax Identification Number (TIN) for the purpose of business registration. Complete TIN forms and attach a copy of photo ID (Drivers, passport bio-data, voters ID). Tax Identification Numbers can be obtained within the space of 24 to 48 hours at any Ghana Revenue Authority office. Also, corporate organizations can obtain TIN; especially when a corporate body is acting as a secretary, and also when shares of the company are being held by a corporate entity, it becomes vital for them to secure a Tax Identification Number. Again, obtaining a Tax Identification Number is absolutely free being it for an individual or a corporate entity.

Step 3 - Complete your RGD documents; Section 13 of the Companies Act 2019 (992).

Form 3 (Return of Particulars of a Company Limited by Shares)- You are required to complete this form with details of the directors, secretary, auditor of the company (name, age, nationality, occupation, postal and physical address) as well as the physical and postal registered address, contact details and the objects of the company as well. Also, you are required to complete this form with details such as the number of shares the company is registered with, who the shareholders of the company are, and the respective shareholding proportions allocated to its members. The minimum stated capital a company limited by shares may have is currently GHC 500.00.

Step 4 - Statutory Declaration and Consent of Directors as well as Secretary.

Submission of statutory declarations of all directors as well as the consent of both Auditors and Secretaries to the Registrar General’s department. Also, you are required to fill the Beneficiary ownership declaration forms.

Step 5 – Payment of Filing Fees and Stamp duty.

Incorporation, stamp duty and filing fees are the main statutory fees to be paid at the Registrar General’s Department. The Stamp duty is basically 0.5% of the stated capital. For example, a stated capital of 100,000 Ghana Cedis is equivalent to a stamp duty of 0.5% multiplied by 100,000 Cedis is equal to 500 Ghana Cedis. The minimum amount of stated capital for all 100% Ghanaian owned limited liability companies is 500 Cedis.

Step 6 – Filing at the RGD and issuing Business registration certificates; Section 14 of the Companies Act 2019 (992).

The sixth and final step of the registration process is the filing at the RGD and issuing Business registration certificates. On paying the filing fees and stamp duty, the documents are then verified and filed at the RGD. If there are no objections, in a few weeks, expect to receive your original certificate of incorporation, certified true copies of form 3 and the Constitution.

In conclusion, business entities are required to undertake the registration processes in other to effectively operate in Ghana. Registration with Registrar General’s Department is quite straightforward. However, forms for registration are mostly queried by the Registrar on grounds of incomplete information or misinformation provided on the forms. This usually results in a delay in the completion of registration. In light of this, Firstcode is here to duly facilitate the processes involved in business registration and also aid clients to deftly acquire their registration certificates.