[Cape Town]

Legal requirements for a retail business and how to register one

South Africa’s retail sector operates under an established legal framework designed to safeguard against any illegalities.

The laws in place protect the interests of the government, the retailer, and the consumer. In this light, all retail businesses in South Africa must register and are under obligation to comply with set legal requirements.

For registered retailers, they count on Guzzle for increased consumer reach and improved sales.

What is the importance of registering a business?

Registering a retail business provides several benefits such as:

1. Registration comes with a Companies and Intellectual Property Commission (CIPC) certification.

2. Registration protects the business name or brand and any accrued intellectual property
associated with it.

3. You gain the confidence and trust of consumers, suppliers, and the market in general.

4. With increased trust in your brand comes the attractiveness which potential investors or partners look for

5. Government assistance and tax incentives can easily be accessed with a registered business.

Which registration supporting documents and needed:

1. You must be above the age of 18 with a valid ID.

2. If you are a non-South African, you will need a valid passport with relevant work or
residence permit.

3. If the business has other partners, certified copies of IDs for such persons are required.

4. At least 4 proposed names of your retail business.

5. Proof of address which is less than 3 months old.

6. Available and current bank statement.

7. Power of attorney (if required).

How and where should a retail business be registered?

The constitutional body mandated with the responsibility of registering businesses under the Companies Act, 2008, is the Companies and Intellectual Property Commission (CIPC). CIPC offers an online registration platform that is user-friendly and straightforward.

A retail business can be registered, with or without a name. In the absence of the name, the applicant can reserve to add a name later but still gets a registration number which automatically becomes a company’s name.

Name reservations take between 1 and 3 weeks, and a company certificate gets issued 3 to 5 days later. You are required to pay a registration fee between R125 and R475 that depends on the type of retail business being registered.

For those who can’t go through CIPC for registration, some banking institutions such as First National Bank (FNB) and Nedbank offer this service.

Key obligations that you have after registration include filing an annual return and paying a yearly fee to retain your business name and trading rights.

What about tax matters?

Every retail business operating in South Africa is supposed to pay taxes. The second step after registering a business a retail business should be to visit a local SARS office or register online.

This is not a compulsory immediate step but can be done within 60 days after the business has started operating.

It’s also worth noting that VAT registration is voluntary if projected or recorded income or revenue within a year is beyond R50,000. If projected, or recorded income or revenue within a year is beyond R1 million, then VAT registration becomes compulsory.

The guidelines listed above should assist you to operate a legally compliant retail business in South Africa.

For advertising and marketing needs, Guzzle is the name you must remember. Retailers can list their digital and print catalogues on the website giving them access to over 700 000 users a month.

Browsing over 11.4 million catalogue pages each month, Guzzle makes it easy for users to plan their deals and specials shopping.

Guzzle Media 

THIS WEEK'S TOP STORIES

Categories :