Why register your business?

[Abdi]

What does the law say and what are the benefits in registering a CC?

[Dave A]

What does the law say

Welcome to The Companies Act (Act 71 of 2008).

and what are the benefits in registering a CC?

As compared to what, exactly?

ps. You might be able to buy an existing CC, but the days of registering new ones are over.

[Abdi]

Why cant i register a new one? If i register as a cc then i would need to register the company for income tax aswell?

[geraldenek]

The new company act came into effect and no new cc are being registered, just companies.

You will have to register the company for income tax. please have a look at this post.

[mbsmit]

Hi there,

Simple Google revealed this domain "www.register-a-business.co.za". These people should be able to offer advice, and there services seems to be very wide.

Give them a ring, maybe they could help? Please post back, would like to read a review from a client.

Regards

[Miro Bagrov]

I will summarise it:
Advantages of a CC:
1. Limited liability, if the CC goes bankrupt, the member's assets are not attached unless they have sighed contract giving such rights.
2. Multiple Members: There were 25 members maximum I think. Please read in act.
3. Company Tax Rates: You will pay company tax rates instead of personal income tax rates. This is a calculation to compare the two.
4. Protect Assets: You can for example create a CC so that you can save you house in case of a divorce (a dirty trick some people use).
5. Others. All other advantages of contracting as a separate entity.

I personally think it is pointless to launch a CC unless there is a need for it. Either reducing your tax rate, or passing on the risk of an operation to another legal person, being the CC.
I think, why make a move just for the sake of making one unless there is a sure benefit?

If you want to start a CC, I can register it for you. I will send you the forms to complete and so forth. You will need an accounting officer as part of registration who complies with the Companies Act. His letter and accounting practice number are sent with this. Most people don't have an accounting officer and just use a generic one. I also have a few such friends.

Hope this helps. Good Luck.

[Miro Bagrov]

It is true that a "CC" doesn't seem to be registrable anymore as of this year.

Here are the new forms of ownership:
Private company (Pty) Ltd
Public company (Ltd)
State-owned company (SOC)
External company
Personal liability company (Inc)
Non-profit company (NPC)

You can still own a CC I think if you buy a dormant (pre-registered) one.

[Blurock]

Any business is subject to tax, that's the law. What business are you in Abdi? The projected turnover would also determine the best form of ownership. If you are a home industry baking for the local shop, it may be better to trade as a sole proprietor. If however you are a manufacturer with multi million rand export orders, a more formal legal entity is advisable.

With more information the experts on the forum will be able to give you much better advice. You may also send them a private message.