- July 14, 2018
- Posted by: Uriel Tomori
- Category: Business plans
HOW TO UPGRADE FROM A BUSINESS NAME TO A LIMITED LIABILITY COMPANY
Upgrading your business name means that you no longer want a mere business name registration, but a Ltd liability company.
I have always advised start ups to do a Ltd liability company registration once and for all, instead of registering as a business name with the hope of upgrading it later to a Ltd liability company.
I understand that the original idea is to actually save cost, but I tell you, when it’s time for the upgrade you realise that you will even be spending more.
So yes, it’s possible to have an enterprise upgraded to the status of a Ltd liability company under the same name.
Here is how to upgrade your business name to a Ltd liability company registration.
1. Make sure that the annual returns for the company has been paid up to date.
A business name registered in 2012 and which has never filed annual returns will be required to pay the annual returns fees and the penalty for late filing for 6 years. For newly registered businesses there is no need to pay annual returns. You can’t initiate the process of the upgrade unkess the annual return fees have been paid in full.
2. Prepare an application letter to the Corporate Affairs Commission for consent to upgrade.
The letter should contain the name of the company and the business name number. It should also state the reason for the upgrade and the new name as well which is basically the same name as the enterprise except for the addition of the word “Limited”
3. Do a new name search as a Ltd liabiity company.
This is after consent
code must have been given it takes about a week or two to get the Consent. Check the status of the name search to be sure the name has been approved, then download the approval notice.
4. Start the actual registration process for a Ltd liability company all over again.
You will need to have atleast two directors to register a Ltd liability company, you will also need to have a share capital with the particulars of directors. You will also need to have the memorandum and article of association of the company. If you are doing the online registration you can just adopt the model memorandum and article of association of the company by CAC.
5. keep checking your status for any query on the application, if there is none, then wait for the registration approval.
Please note that the effect of upgrading your business name to a Ltd liability company is that you loose the previous business name registration.
If you are thinking of expanding and you are worried that people already know you with a particular business name, then you can simply upgrade to a Ltd liability company under the same name.
If you are thinking if registering as a business name now with the hope of upgrading later, my advise would be to just go ahead and. Register as a Ltd liability company once and for all.
By Barr. Joy Bema