The A-Z of CAC for Nigerian SMEs: From First Registration to Annual Filings

For every ambitious Nigerian entrepreneur, the journey begins with a powerful idea and the drive to bring it to life. Yet, between perfecting a product and winning the first customer, there lies a crucial, often intimidating step: formalizing the business. The Corporate Affairs Commission (CAC) can seem like a complex maze of rules and procedures.

However, understanding and navigating the CAC process is not a bureaucratic hurdle to be feared; it is the foundational step that transforms a “side hustle” into a legitimate, scalable, and trustworthy enterprise. Proper registration and ongoing compliance are what give your business the credibility to open bank accounts, secure loans, bid for contracts, and build a lasting legacy.

This A-Z guide will demystify the entire lifecycle of CAC compliance, from choosing a name to filing your annual returns, providing you with a clear roadmap for success.

Phase 1: Pre-Registration (The Foundation)

This is the planning stage, where you make the key decisions that will define your business’s legal structure.

A. Choose Your Business Structure: This is your first and most important decision. For most SMEs in Nigeria, the options are:

• Business Name: Perfect for sole proprietors or partnerships. It’s simpler and cheaper to register, but it doesn’t create a separate legal entity. This means you are personally liable for the business’s debts.
• Private Limited Company (LTD): This creates a separate legal entity, shielding your personal assets from business liabilities (limited liability). It’s more formal and is the preferred structure for businesses seeking investment or aiming for significant growth.

Take for instance, Funke, a talented fashion designer starting her own label, might begin by registering a Business Name like “Funke’s Fashions.” It’s straightforward and meets her initial needs. Conversely, Tunde and Chioma, co-founders of a new fintech startup, should register a Private Limited Company like “PaySwift Tech Ltd.” This protects their personal assets and creates a structure that allows them to sell shares to investors in the future.

B. Pick and Verify Your Name: Choose a unique name for your business. Before you get attached, you must conduct a name availability search on the CAC portal to ensure it’s not already taken.

C. Gather Your Documents: You’ll need key details for all proprietors or directors/shareholders, including:

• Full names, addresses, and phone numbers.
• A valid government-issued ID (NIN Slip, Voter’s Card, etc.).
• Passport-sized photographs.

Phase 2: Registration (Making it Official)

The registration process is now almost entirely online via the CAC Registration Portal.

D. Create an Account & File: You (or your accredited agent) will create an account on the portal, formally submit your chosen name for reservation, and once approved, proceed to fill out the registration forms with the details you gathered.

E. Pay the Fees & Submit: You will pay the official filing fees securely online. As of late 2025, registering a Business Name costs around NGN 21,000 excluding charges, while a small private limited company might cost NGN 50,000 or more, depending on the share capital.

F. Receive Your Certificate: Once your application is approved, the CAC will issue your digital certificate of registration and other incorporation documents (like a Status Report). Congratulations, your business is now a legal entity!

Phase 3: Post-Registration (Staying Compliant and Growing)

Registration is the beginning, not the end. Ongoing compliance is crucial for keeping your business healthy and active.

G. Open a Corporate Bank Account: This is your immediate next step. A corporate account separates your business finances from your personal funds, builds credibility, and is a non-negotiable requirement for loans and serious clients.

Practical Illustration: After receiving her certificate for “Funke’s Fashions,” Funke immediately walks into a bank with her CAC documents and NIN slip. She opens a corporate account, and when a customer wants to place a large order, she can confidently provide a professional business account number, building instant trust.

H. Handle Your Tax Registration (TIN): For newly incorporated companies (LTDs), a Tax Identification Number (TIN) is now often generated automatically upon registration and linked to your FIRS office. For Business Names, you may need to complete the registration process with the Federal Inland Revenue Service (FIRS). A TIN is essential for all tax filings and for obtaining a Tax Clearance Certificate (TCC).

I. File Your Annual Returns (The Most Important Step): This is not a tax return. It is an annual update submitted to the CAC to confirm that your business is still actively operating. It keeps your company’s information (directors, shareholders, address) current on the register.

• Why it’s crucial: Failure to file leads to an ‘inactive’ status, hefty penalties, and can ultimately result in the CAC delisting (striking off) your company from the register.
• When to file: For a new company, the first annual return is due 18 months after incorporation. After that, it must be filed once every calendar year.

Practical Illustration: Eighteen months after registering “PaySwift Tech Ltd.,” Tunde and Chioma’s accountant reminds them to file their first annual returns. They provide a summary of their financials and confirm their director details. By filing on time, they maintain their ‘active’ status. A few months later, when they apply for a major tech grant, their proof of up-to-date annual returns is a key requirement, which they easily meet.

J. Report Significant Changes: You must also notify the CAC of any major changes in your business, such as a change of address, appointment or removal of a director, or an increase in share capital.

Conclusion

Navigating the world of the CAC doesn’t have to be a daunting task. By understanding the journey from A to Z—from choosing the right structure and completing your registration to diligently filing your annual returns—you build more than just a company. You build an institution.

Viewing these steps not as chores but as crucial milestones will set your Nigerian SME on a path of credibility, stability, and limitless growth. A compliant business is a trusted business, and a trusted business is one that is built to last.