The Corporate Affairs Commission often urges registered companies to always file returns to the commission to avoid deregistration. It is not enough that people register companies, they must equally file returns as required by law because it is through return filing by companies that the commission is able to know which companies are active and which ones are not.
Usually, companies that have filed returns up to date are active. Those that have not filed returns up to date are classified as inactive, and subsequently, these inactive companies may be delisted.
The commission has the power to strike out the name of a company or business name from the register of companies, if there is a reason to believe that the company is no longer in operation.
What Is Annual Return?
An annual return is a yearly statement by an active registered company or business name to the CAC, meant to keep the Commission updated on the company’s activities and financial position. It is not a financial document, but rather a yearly statement. Annual return is a mandatory statutory requirement for every registered business entity or organisation in Nigeria, whether a company, business name or incorporated trustee. It is to be filed not later than 30th June every year except the year in which the company is registered does not end in December.
How Then Do I Revive a Company Registered a Long Time Ago?
Now assuming you registered a company about 20 years ago and since then, the company has not functioned, but you now intend to bring back the company to life legally due to one reason or another, how then do you go about it? For reasons as grant of government loans, or business opportunity, one may decide to make their company active.
First, you must be sure that the company is still listed on the CAC website by conducting a search. Searches can be done using the company’s name or RC number. Where the company is found, it will be listed as active or inactive.
Note that for each defaulting year, there is a penalty.
After becoming aware of the company’s status, where inactive, the following steps should be followed in reactivating the company:
- Calculate the number of years from which the company has failed to pay annual returns till present, times the amount to be paid yearly plus the penalty for late filing. For business name, the amount payable for annual filing fee is 3000 Naira and 5000 Naira for companies. The penalty for default is also pegged at 3000 Naira and 5000 Naira, respectively.
- Duly completed annual return form for each year in default, signed by a director and/or secretary of the company or proprietor in the case of a business name.
- Prepare statement of affairs for each of the defaulting year. A statement of affairs is a summary of a business or company’s assets and liabilities. It is usually prepared by an accountant or an accounting firm to accompany annual filing submitted to the Corporate Affairs Commission, CAC. Without attaching statement of affairs, your application to CAC to change a company’s status will not be approved.
- Make payment for each defaulting year, that is, for instance, 5000 Naira for annual filing fees, and 5000 Naira for default, totaling 10,000 Naira each for every year. Payment can be made online via the Commission’s CPR portal. The payment platform, Remita, charges a little amount for each payment.
- Forward all receipts of payment as well as copies of the statement of affairs for each year to CAC by email. Upon submission, the Commission will review the status of the company and the information given, then issue an acknowledgement letter of receipt of payment.
- Upon receipt of acknowledgement of payment, write to the CAC via email to change the company’s status from inactive to active. The6 change should reflect within 24 hours.
The whole process takes less than a week to change the company’s inactive status.
Onwards, endeavour to file your annual returns yearly to prevent your company from being delisted, prevent incurring additional fees as penalty for late filing, and for easy access to the company’s record with the Corporate Affairs Commission.
It should be noted that, for ease of doing this, ensure to contact a registered CAC agent such as Akinlabi Segun on 07056671465 or akinlabisegunpamilerin@gmail.com as this write-up is only a guide on the process.
