There are certain responsibilities that come with owning a registered business in Nigeria. One of such responsibilities is filing annual returns for your business.
In this article, you will learn what an annual return is, how much it costs for each business type and how to file it.
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What is an Annual Return
The name annual returns doesn’t do justice to what it really means. For the uninformed, it sounds like informing the Corporate Affairs Commission how much the business makes annually.
Annual returns is a process of confirming to the corporate affairs commission that your business is still active. It involves submitting or updating key company information such as the details of the director, shareholders, registered company address.
Not filing your annual returns signals to the commission that you are no longer in business. This may lead to your business being delisted from the registry.
Benefits of Filing Annual Returns for your Business
Keeps you Compliant
The law mandates that every business registered in Nigeria must file its annual returns. This means it is unlawful to operate your business without filing your annual returns frequently.
When you do not file your annual returns for a consecutive period of time, your business will be delisted from the CAC registry, making it inactive. Staying up to date with your annual returns helps you maintain good standing with the Corporate Affairs Commission (CAC), preventing penalties, legal complications, or even the risk of being struck off the register.
Perform Post Incorporation Activities
Perhaps you want to change your business name, update share allotment, add a new director or secretary to your business etc, you will not be able to do this unless your annual returns filing is up to date. As a business owner, you should keep your filings current to ensure smooth business operations and avoid unnecessary delays when making important changes to your company’s structure.
Avoid penalties
For each year you do not file an annual return for your business, there is a penalty that is included in the filing fee. This means that the longer you delay, the higher the amount you will have to pay when you eventually decide to file. Over time, these accumulated penalties can become a significant amount, making it more costly to regularize your business status.
To avoid unnecessary expenses and complications, it is advisable to file your annual returns promptly each year.
When to File your Annual Returns
The time frame to file annual returns depends on the business type. Check the list below to know when to file your annual returns.
Business name
Businesses registered as a business name (BN) are to file their annual returns on or before the 30th of June each year except for the year the business was registered.
Limited Liability Companies (LTD)
Newly registered companies are to start filing their annual returns from the 18 month after incorporation. Subsequent filings must be done within 42 days after the company’s annual general meeting.
Incorporated Trustees
Incorporated trustees are required to file between June 30 and December 31 annually. However, they are exempted from filing in the first year of incorporation.
How much does Filing of Annual Returns cost?
The price you will pay for filing your annual returns depends on your business type. Below is the filing fee for some of the business types available;
Business name
Annual filing fee: ₦3,000.
Penalty for late filing: ₦5,000
GrowthPal filing charges: ₦3,500 per year
Limited Liability Company
Annual filing fee: ₦5,000
Penalty for late filing: ₦10,000
GrowthPal filing charges: ₦5,000 per year.
Incorporated Trustees
Annual filing fee: ₦5,000
Penalty for late filing: ₦10,000
GrowthPal filing charges: ₦5,000 per year
Note that if you pay your annual returns on time, you won’t pay the penalty fee.
Requirements to File Annual Returns
To file your annual returns, you’ll need the following documents;
- CAC documents.
- Information of the directors, secretary and shareholders. This information include; ID card, phone number, email address and home address.
- Any recent company update (if any)
How to File Annual Returns for your Business
To file your annual returns, you need the service of an accredited business consultant like GrowthPal. Send a WhatsApp message to GrowthPal to file your annual returns.
If you prefer to communicate via email, send GrowthPal an email at [email protected]
Immediately after payment for your annual returns filing, you will receive a receipt from GrowthPal indicating confirmation of your payment and details of the service you paid for.
Within 7 days after your annual returns have been filed, you will receive an evidence of update from.
FAQ on Filing Annual Returns
Who can file annual returns?
Only a registered agent or consultant can file annual returns for your business on the CAC portal.
Do I need to file annual return?
If you are a registered business, yes, you need to file your annual returns yearly.
How long does it take to file an annual return?
Annual returns are filed immediately after payment to GrowthPal, however, it could take about 7-21 days to reflect on the Corporate Affairs Commission portal.
What is the penalty for not filing annual returns?
Your business will be delisted from the portal and you also pay a penalty fee for every year you do not pay.
What is the penalty for filing annual returns late?
When you do not pay on time, you pay between ₦5,000 and ₦10,000 for each year you did not pay.
Who is exempted from filing annual returns?
No business is exempted from filing annual returns.
We hope, with this, you have learnt what an annual returns is and how to file annual returns for your business. You can also read our article on how to register a business in Nigeria and how to generate a business name.
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