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Thread: Starting a HOLDINGS Company

  1. #11
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    I could think of a number of scenarios.
    1.Say, in future, for example you want to offer shares from one your division, ABC Contractors which is a subsidiary of ABC Holdings offers share for partnership with someone with experience or vast knowledge and network in construction. But you don't want them to have any association with ABC Cleaners or ABC IT Solutions.

    2. Protection of your other business, should there be a legal dispute

    It's quite a lot of administration. If I decide to use just one company for everything, won't it affect records? Cause then it'll be like you forming a new company e.g. ABC Contractors, should I decide to only register that company independently when it's a large company

  2. #12
    Site Caretaker Dave A's Avatar
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    Reminder: A holding company can only "trade" in the ownership of other registered companies.
    This means the short answer to

    Quote Originally Posted by sbongak View Post
    Does this mean that each subsidiary needs to be registered?
    is YES.

    You should also bear in mind that each activity of the company needs to fall within its declared scope of activities.
    The trouble with opportunity is it normally comes dressed up as work.

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    Quote Originally Posted by Dave A View Post
    You should also bear in mind that each activity of the company needs to fall within its declared scope of activities.
    How necessary is this really? Usually we have to fill in our main source of income when doing tax returns for example. But surely there is no requirement to only work in a specific industry?

    For example: If we are currently making plastic hats for the entertainment industry, are we really forbidden from now trading in steel hats for the mining industry?

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    Thank you for this information, I also register a company but I am still deciding on a name, my aim is to have a holding company and later the subsidiaries trading under it. Thus from what I deduce from the discusion above is that I need to declare it with CIPRO?

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    A "holding" company is simply a company, no different from any other, that holds shares in other companies. In fact, there isn't really such a thing as a "holding" company.

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    So in fact where does one find a holding company to buy in South Africa :?

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    Hi Everyone. Fortunately i found this post before i asked similar questions and started a whole new thread.

    I am a new business owner and have decided to take the opportunity and start my own Tourism business doing day tours, lodge and airport transfers and also to start a tourist information center. I would ideally like to operate all of these as separate entities under one 'holding' company.

    So..... Just to clarify from what i have read in this thread... The company that i want to use as the 'holding' company would be (for example) Batman Investments Pty (Ltd). This would be registered with CIPC and have 100 shares which would be split, in my case, 70/30. The subsidiary companies would be XYZ Day Tours, XYZ Transfers and XYZ Tourist Center. These would all need to be registered with CIPC as Pty (Ltd) companies and each would have 100 shares which would then immediately be bought out by Batman Investments Pty (Ltd), so that Batman Investments owns them each outright.

    Am i on the right track so far?

    If i am, then when it comes to VAT registration and taxes, would / could all three subsidiary companies be using the one VAT number that is registered to Batman Investments? Or, would each company HAVE to have its own VAT number? On the same note, if all three are using the same VAT number, then Batman Investments is paying the tax not each company individually?

    Now, if they are all registered on CIPC as separate companies but owned by Batman Investments, they are then essentially stand alone enterprises and do not need to trade under 'Batman Investments Pty (Ltd) trading as XYZ Day Tours.' It could, in theory, just trade as 'XYZ Day Tours.'

    I'm sorry if there is some repetition here, but i just want to try and fully understand this process as there is currently a lot of conflicting information on the internet and nothing, bar this thread, has actually helped me to understand it.

    I am looking forward to hearing back from you all and getting some much needed clarification.

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    Quote Originally Posted by Gav View Post
    So..... Just to clarify from what i have read in this thread... The company that i want to use as the 'holding' company would be (for example) Batman Investments Pty (Ltd). This would be registered with CIPC and have 100 shares which would be split, in my case, 70/30. The subsidiary companies would be XYZ Day Tours, XYZ Transfers and XYZ Tourist Center. These would all need to be registered with CIPC as Pty (Ltd) companies and each would have 100 shares which would then immediately be bought out by Batman Investments Pty (Ltd), so that Batman Investments owns them each outright.

    Am i on the right track so far?
    Yes you are.

    If i am, then when it comes to VAT registration and taxes, would / could all three subsidiary companies be using the one VAT number that is registered to Batman Investments? Or, would each company HAVE to have its own VAT number? On the same note, if all three are using the same VAT number, then Batman Investments is paying the tax not each company individually?
    Multiple entities can never share a VAT or Tax number. A single entity with multiple branches could have multiple VAT numbers, but never the other way round.

    Now, if they are all registered on CIPC as separate companies but owned by Batman Investments, they are then essentially stand alone enterprises and do not need to trade under 'Batman Investments Pty (Ltd) trading as XYZ Day Tours.' It could, in theory, just trade as 'XYZ Day Tours.'
    Spot on. Actually, they are obliged to trade for themselves; they may not trade under the holding company's name.

    A holding company scenario is simply one where you, the shareholder who would normally own the shares in a trading company, is replaced with a company in which you you own the shares, and it owns all or some of the shares in the subsidiary company. The subsidiaries can also own shares in each other and can in fact own some shares in the holding company.

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  10. #19
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    Thank you so much for your help with this! I really appreciate it a lot!

  11. #20
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    People i have to bud in here ! I registered a pty ltd in June 2015...recently a family started a laundromat service and asked me to partner with him. This business is however not registered and i want to incorporate it into my pty ltd. Help please...

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