Requirements and Cost of Filing Annual Returns in Nigeria

The fees of annual filing for a Registered Company and a Business Name are N5,500 for annual filing and N5,000 penalty for late filing, making N10,500 per year. The cost excludes charges of accredited CAC agents.

Instead of paying a fine of N5,000 for each year you missed for failing to file your returns, wouldn’t you rather begin to do the needful before it turns into thousands of naira?

So, filing a company’s returns with the Corporate Affairs Commission (CAC) is very important if you don’t want your company to be delisted.

What are Annual Returns?

An annual return is a yearly statement by an active registered business name or company which is meant to keep CAC updated about the company’s activities, composition, and financial position.

The returns are not the profit a company makes in a year, it is not a financial document, and it is not a tax.

Its Benefits:

1) It allows businesses and individuals to comply with tax laws and regulations.

2) It allows businesses to claim deductions and credits to which they are entitled, especially in a country that takes the filing seriously.

3) It allows your business to apply for government incentives

4) It enables a company to maintain its “Active Status” on the CAC portal. If you checked the status of your company and what you see is “INACTIVE” on your company’s profile that means your annual filing is not up to date.

Chapter 16 of the Companies and Allied Matters Act (CAMA 2020), covers everything pertaining to filing returns.

Section 418 of CAMA 2020 states:

The annual return by a company having shares other than a small company shall contain with respect to the registered office of the company, registers of members and debenture holders, shares and debentures, indebtedness, past and present members, directors and secretary, the matters specified in Part I of the Seventh Schedule to this Act, and the return shall be in the form set out in Part II of that Schedule or as near to it as circumstances admit.

Simply put, it is an application to show the regulatory commission that the company is still active in business.

Failure to perform this over years may lead to the delisting of your company. To know if the record of a company is up to date on the database:

• Head straight to the CAC home page,
• Click “Public Search”,
• Use the RC Number of the company or the BN number of the business and click search
• If the company is inactive, it will show it

For those who want to take their business to the next level by registering or those with multiple CAC query rejection reasons, we have a guide to help you resolve the issue in under an hour, you can find it at: https://infomediang.com/cac-queried-registration

There are some misconceptions about an annual return in Nigeria. Some companies, most especially sole proprietorships, believe that they might be heavily taxed if they continue to file annual returns with the CAC. This is not true

How much would I pay for failing to pay returns for 14 years?

	Limited Liability Company	Business Name
Annual Return	N5, 500	N5,500
Late payment	N5,000	N5,000
Total	N10,500 per year	N10,500 per year

Here is a scenario…

Mr Goodness (not real name) registered Granula Enterprise (Business Name) in February 2008, but since then he has never filed an annual return and in 2023 he’s ready to do the needful.

In this situation, Mr Goodness will have to file returns from August 2009 till 2021, that’s 14 years.

14 X N10,500=N147,000

The above excludes the service charge of an accredited agent.

When to file returns:

Limited Liability Company (LLC) and Business Name, and every registered business in Nigeria are expected to file their returns with the Corporate Affairs Commission no later than 30th June every year.

Incorporated Trustees like NGOs in Nigeria are also required to file annual returns which we have extensively covered in another article.

The only exception to this is when the calendar year in which the business name is registered does not end by December.

When Should a New Business Start To File Returns In Nigeria?

Usually, a newly incorporated company is given the grace of the first 18 months while a Business Name is given 12 months before filing a return.

What this means is that a company that was incorporated in January 2020 will have to start filing beginning in July 2021.

However, the older companies are expected to file their return not more than 42 days after their Annual General Meeting.

Consequences of Failing to File Your Returns

Three things will happen if you fail to file annual returns at the Corporate Affairs Commission (CAC):

1) Your company may be delisted if you fail to do so for several years.

2) You will pay a fine if you want to reactivate your company name which may be more than the actual return

3) You will find it difficult to apply for a government contract or government credit facility. Now that you know the importance of filing annual returns of your company, see below what you need to get it done

Requirements for Filing Returns

• A photocopy of your Business Certificate
• A copy of the Company’s CAC Form 7 (now known as a status report).
• A photocopy of the Memorandum of Association

Before the commission went digital, applicants would have to download CAC Form 10 or obtain it at any of their branch offices, but the online issue resolution has invalidated this method, a such you don’t need to go for an assessment at CAC office any longer.

Key points

1) Filing of annual returns doesn’t only save you the yearly penalties by CAC, it also shows that you are law-abiding

2) It will also give you an edge when accessing government loan

3) Annual returns is completely different from tax payment.

Related Issues and Solutions

If you’re trying to file the annual return, you are likely to encounter the following issues:

What to do if payment of the filing fee doesn’t reflect on your portal

In a situation whereby your payment of filing return doesn’t show on your dashboard even when you’ve been debited by your bank, you can resolve the issue by:

• Logging into your portal
• Click the “Check Payment Status” button against the application.

If it isn’t showing, then contact remita or your bank to resolve the issue. You can contact remita by sending a complaint to support@remita.net

You can use the official Facebook page of your bank to send your complaints or use the complaint WhatsApp if your bank is on the messaging app.

What to do if payment of stamp duties doesn’t reflect on portal

If you’ve been debited by your bank, yet the payment isn’t reflecting on the CAC annual returns portal, take the following actions:

• Log in and click the “Check Status/Pay Stamp Duty” button

If nothing is showing on your dashboard, send a complaint e-mail to support@stampduty.gov.ng

• You must indicate the Remita Retrieval Reference (RRR)
• After the resolution, log in back to the portal
• Click “My Registration” button
• Click the “Check Status/Pay Stamp Duty” button

It issue should be resolved.

Can a company be exempted from filing returns to CAC?

You could get an import duty waiver, but you CAN’T be exempted from filing annual returns to the CAC.

Do I Need To Register On the CAC Portal To File Annual Returns?

No! An existing company does not have to register on the CAC portal to file Annual Returns. What they need to do is simply file the Annual Returns through an Accredited Agent via the post-incorporation portal.

What this means is that the CAC post-incorporation portal is designed for an accredited CAC agent. The accredited agents receive special training from CAC on how to properly file returns.

An individual can only register/sign up on CAC portal to register their business or company, they can’t file annual returns, and only accredited CAC agents are trained to handle post-incorporation issues.

Do you need our assistance?

We will effectively assist you in filing your company’s return without any glitches.  Talk to us at InfomediaNG-BTS Business Solutions or send us a message on WhatsApp: +2348027024054