Company Registration is a wise decision made by all successful entrepreneurs that understand that being in business is simply offering a product or services to someone for a profit. If you are reading this article you already understand that it’s quite easy then to be in business and therefore there is a great need to protect and grow your business idea by formalizing it through company registration.
7 REASONS Why You Must Register Your Company in Zimbabwe
NB: Although we have focused on Zimbabwe these reasons are applicable to most other nations on the globe.
1) Protect Your Trading Name
We have already established the simplicity of being in business. This means that if your business name is not legally recognized then anyone can use the name or worse they could legally register your name and sue you for using their registered name. So you must register your genius catchy company name so that no one else in Zimbabwe can use it and potentially confuse clients and cost you sales or worse your business.
2) Separate Legal Entity
At the very least you should be concerned about the business risk to your personal property so it’s critical to ensure that your personal assets are protected from suits brought against your business. Register your business and ensure that lawsuits against it do not affect your personal belongings; the extent of your liability is tied to the number of shares you own in the business. By Zimbabwean law, your registered business is deemed to be a separate legal entity.
3) Business Continuity
An incorporated business has an unlimited lifespan, meaning that even if the directors leave, die or there are changes in the company ownership… the business will not seize to exist. This allows your business to outlive all its directors, shareholders and employees. You can see how this is ideal for other folks you want to do business with. This is the reason most institutions and individuals prefer to do business with a registered business. Surely you are now compelled to register your business.
4) Equity Financing
As suggested in the previous point, most people including investors prefer to do business with registered companies. So company registration is critical in order for your business to be able to attract individual or corporate investors because it guarantees better protection for their investment even if there is a change in ownership of the company. If you are already in business you already appreciate the importance of raising money in order to grow your business. Company Registration is vital for you to attract serious investors.
5) Debt Financing
Almost every business at some point will consider borrowing money from institutional lenders such as banks to finance business growth. Company registration becomes vital because banks will not lend money to a business that does not have formal registration documents and is a legal entity otherwise the risk will be almost 100%. If your company is not registered you can forget borrowing money from banks to finance your business growth.
6) Business Bank Account
It is more professional for you to give clients a corporate bank account than a personal bank account and less risky for your clients to deposits funds into a corporate bank account. Zimbabwean banks are required by law to request company registration documents before opening a corporate bank account. Need I say more? If you want a company bank account in Zimbabwe then you have to register your company.
7) Tax Benefits
As a registered business you are entitled to a range of tax deductions and benefits that
You are not doing yourself a favor by operating an unregistered business. The risk is not worth it! At the very least you risk losing your business to an opportunistic entrepreneur that could register your trading name and prohibit you from using your own creation. How sad would that be?
Feel free to ask any questions in the comments section below and will respond to them as quickly as possible. Glad to see you reading this article; it’s the first step to starting your business on the right foot. In my next article I will review the different types of company registrations available to you in Zimbabwe.
REGISTER YOUR COMPANY TODAY: click here to begin the process…
Ottawa University Graduate in (Honors) Accounting. After attaining a few accounting designations and proving to myself that I can pass exams at the highest levels, I now chase after my biggest dream – HAPPINESS! My passion is progressing my community through online technologies and giving an opportunity to AIDS orphans in Zimbabwe…