MyTime3:
"You CAN Establish before you incorporate"

Only in Naija. And the informal sector

MyTime3:
"You CANNOT Incorporate before you Establish"

This is not true. You can

jaz:
ive read quite a bit of comments and must say i'm amused. lots of incorrect info being passed around. let me clarify a few points.

- the Law governing establishment and management of a business enterprise, whether sole proprietorship, partnership, limited companies, public entities, is the "Companies and Allied Matters Act" of Nigeria

- According to Part B, Section 573 (1) of CAMA" "Every individual, firm or corporation having a place of business in Nigeria and carrying on business under a business name shall be registered..." so once you establish even a shop you are required by law to register with CAC. this is further corroborated in Section 21 (1c) of CAMA.

- Date of establishment is also the same as the date of incorporation because no company can operate in Nigeria without registration

You've just given a textbook definition.

There are a thousand and one established businesses operating within that locality of yours, which as we speak are yet to be incorporated. Sure they can't run corporate accounts, do not pay tax recognized by the FIRS, but pay tenement, waste management, business registration/renewal fees, etc, to the state government.

They are businesses running, but are yet to be incorporated by CAC.

That last statement of yours should be restricted to companies. A business can be established and running, long before it becomes incorporated.

routik:
Hello people,

I need clarification on the difference between Incorporation year and Established year.

I am aware that year of incorporation is the year that appears on your company's CAC certificate. But when you see Established year, does it mean the year you started operations or is it the same thing with year of incorporation?

If they are different, which one do you select in celebrating your company's anniversary?, as many businesses didn't start operations the same year they were incorporated.

Your reasonable input will be highly appreciated.

There is a difference between 2 of them. First, established refers to when the business actually started or was registered and incorporation refers to when the business was made an incorporation type of business structure. Second, there are different business types or structures that are not incorporations but a different business structure type. For example, businesses formed as partnerships are not incorporations yet it is still a business type. A business structure type can be changed over the course of time depending on the owner (s). Such a partnership business can be established in 2000 and the business type changed to an incorporation, say, in 2007. One difference between a business that is an incorporation and one that is not is the addition of 'inc' to the business name.

Tinyemeka:


You still didn't answer his question.

@OP, there are some things you may need to query wiki instead of coming to waste time on NL.

Year of Incorporation: The year you register the business as a separate legal entity recognized by law. Meaning your business can sue or be sued, is recognized by the government and therefore required by law to pay tax. In Naija's business environment, it's the year you registered your business with the Corporate Affairs Commission.

Year of est: https://en.m.wikipedia.org/wiki/Date_of_establishment

The OP was never in doubt about year of incorporation.

Mr. Y conceived an idea and started making and distributing cakes from the comfort of his home in 2005!

Two years later (2007), he decides to expand (Register "Y-Cakes" with CAC)

One year later (2008) he achieves his dream (Rents a shop, employs people etc.)


What year was his business established? a) 2005 b) 2007 c) 2008

franciskaine:
but sir, what if a biz gets its approval from CAC and becos of the unavailability of its input at the very period fail to start operation, can the biz be said to have been established?

Date of incorporation is the date you got legal approval from Corporate affairs commission (CAC) to begin business and the date of establishment is the date you actually started business, hope this helps. Now that you're established I think its time you invested in real estate , check my signature.... Check my signature.

The problem here is the choice of word used. Year of incorporation no doubt is the year a business is duely registered with the appropriate authority. Iikewise year of establishment is d same as year of incoporation, no fifferent. However, the proper word to use is year of COMMENCEMENT. This is what is regarded by tax authorities as the year a business commence operation and tax is calculated based on year of commencement not year of incorporation/establishment. So if u want to celebrate your company anniversary, it should be year of commencement. Incorporated year is an idea, while commencement year is idea translate to action.

MyTime3:
Mr. Y conceived an idea and started making and distributing cakes from the comfort of his home in 2005!

Two years later (2007), he decides to expand (Register "Y-Cakes" with CAC)

One year later (2008) he achieves his dream (Rents a shop, employs people etc.)


What year was his business established? a) 2005 b) 2007 c) 2008

I had choose 2007, so far his biz is not recognised by law and does not pay tax. Thanks for your explanation anyway.