Starting a Company
To register in Nigeria, a foreign company must have a minimum authorized share capital of ₦10 million ($26,655). You must register with the Corporate Affairs Commission (CAC) within twenty-eight days of commencing business, which you can do at cac.gov.ng. You’ll need to propose a company name, provide details of the directors, shareholders and nature of business, submit your articles of association and pay a stamp duty and fee. Reservation of a name is ₦500 ($1.33) and registration of a company with share capital of more than ₦1 million has a fee of ₦10,000 ($26.65) per ₦1 million or part thereof. You should receive a Tax Identification Number within two weeks of registering your business with the CAC. Register for Value Added Tax and Withholding Tax at the nearest FIRS office, which you can find through firs.gov.ng.You will also need to register with Nigeria Investment Promotion Commission (NIPC), a statutory body that promotes foreign investment. Go to nipc.gov.ng to download the form, pay ₦15,000 ($39.98)and then send the completed form, evidence of incorporation and proof of payment by mail to the NIPC office. Every new company wholly owned by foreigners must also apply to the Ministry of Interior (interior.gov.ng) for a business permit. Expect the whole business registration process to take around two months for a routine application. For a more detailed overview, consult nipc.gov.ng/iguide/getting-started.
Opening a bank account
To open a personal or business bank account in Lagos, you’ll need a resident permit, passport photos, proof of address and valid photo ID. Some banks may ask for a letter from an employer or references. Having a reference who holds an account at the same bank can speed up the application process. A minimum cash deposit is required, which can be as low as ₦2,000 (around $5), and most banks issue ATM cards. Accounts have a monthly charge, but it is usually less than ₦375 ($1). Medium and big businesses usually accept local and international credit cards, but cash is the main form of payment in Lagos and you’ll need it for everyday expenses such as meals in casual restaurants or items from small shops and markets.
The Lagos Internal Revenue Service (lirs.gov.ng) collects personal income tax, which is assessed using graduated rates from 7 percent to a maximum of 24 percent for those earning more than ₦3.2 million ($8,530). Non-residents are subject to the same rates as residents and Nigeria has double taxation treaties with various countries. Companies pay income tax through the Federal Inland Revenue Service (firs.gov.ng) and you should receive a tax number when you register your business. Businesses with an annual profit of more than ₦100 million ($26,6548) pay 30 percent tax, and those with profit between ₦25 million ($66,637) and ₦100 million pay 20 percent. Companies with less than ₦25 million annual profit are exempt from paying tax. Nigeria’s VAT rate is 7.5 percent and local governments collect taxes and levies for services including sewage and refuse disposal. Local tax consultants include KPMG (kpmg.com/ng), PwC (pwc.com/ng) and Andersen Tax (andersentax.ng).
[Phone and internet]
There are four main telecommunications companies in Lagos: MTN, Airtel, Glo and 9mobile. SIM cards can be bought and registered in company offices or at stands that you’ll see around the city. You’ll need valid photo ID to buy a SIM card and a photo and fingerprints are taken as part of the registration process. Most locals use pay-as-you-go packages, but unlimited plans are available. Expect to pay around ₦24,000 ($64) per month for unlimited calls and data. Broadband is not widely available in Lagos, and most people use 4G to access the internet. Companies such as Swift, Smile, Ntel and Spectranet offer data-only services.