ANNUAL RETURN

You have probably heard about Annual Returns and wondering what it means. You have a registered business, company or non-governmental organization with the Corporate Affairs Commission known as CAC and wondering what else after registration. After registering your business, you are expected to file annual return to the CAC, the body responsible for the registration and regulation of registered entities.

We have tried answering all these frequently asked questions on annual returns.

WHAT THEN IS THE ANNUAL RETURN?

Annual Return is a mandatory statutory payment made to the Corporate Affairs Commission by every registered entity (business name, company, incorporated trustees) to show that the entity is still a going concern.

I HAVE NOT COMMENCED BUSINESS WITH MY REGISTERED BUSINESS DO I FILE RETURNS?

Whether you have commenced business or any activity with the registered entity, you are expected to file/pay annual returns to the corporate affairs commission every year except the year it was registered. This shows that your registered business is a going concern with the commission.

IS ANNUAL RETURN NOT THE SAME AS TAX TO THE FIRS?

Annual Return is not the same as tax! It is not tax paid to the Federal Inland Revenue Services (FIRS)or the State Inland Revenue Service (SIRS) Whether you commenced business or not, you are to notify the commission CAC by filing returns of your registered entity every year except the year it was registered for business names and incorporated trustees, while companies can file 18 months after registration and within 42 days after their general meeting.

CAN I NEGOTIATE THE FEE SINCE I AM YET TO COMMENCE BUSINESS?

Annual Return is statutory. The fee for annual returns is fixed. This means if you have a business name and your turnover is more than 10 (ten) million Naira, you would still pay the same annual return fee as a business that is yet to commence any activity.

WHAT ARE THE CONSEQUENCES OF NOT FILING MY RETURN AS AT WHEN DUE? 

• Failure to file your returns as of when due, your status will be “INACTIVE”. This has caused serious concerns recently. We have had clients say they were denied visas when they submitted their business documents because their business status was “INACTIVE” on the Corporate Affairs Commission search portal.  

• Your registered entities may be delisted from the Corporate Affairs Commission search portal if you do not file your returns for more than ten (10) years; we have had to request for the CAC to reinstate some businesses to the portal because they were delisted or omitted and one thing that stood out for all these entities, there were not filing their returns.

• Failure to file returns as of when dues will incur penalties for late filing for the entity. The penalties are always more.

• You may lose opportunities for failure to file your returns as when due. 

• Prospective investors and businesses can check your entity’s status on the CAC public search portal and may discover that your entity’s status is “INACTIVE which suggests that it is not a going concern.

 DEADLINES FOR FILING ANNUAL RETURNS

•  BUSINESS NAME: 30th June of every year except the year it was registered
•  COMPANY: 30th June of every year except the year it was registered, 18 months after registration and 42 days after the general meeting. 
• Incorporated Trustees/NGO: 30th June or no later than 31st December

Fathenso Professional Services can quickly and easily help you file your annual return and update your status with the CAC. send us an email at info@fathensoservices.com or call 09029926107

Written by Victory Aburime, ACIS

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