Register a CC or a PTY Ltd

[Jozi]

I would like some general advice on to whether I should register a CC or a Pty Ltd. I am starting a new company that will deal with small to medium size companies and a CC to me is the logical option, but with the laws that will affect the future of CC's is it a better option to proceed with a CC. Also, what are the costs of associated the start of these options.

[manhav]

Hi Jozi

CC's still remain the most suitable entity for a business. It is easier to manage a CC than a company seeing that the formalities that you have to comply with are far less than in the case of a company.

To start a CC is actually quite easy, and there are quite a few companies that specialize in the registration of CC's and companies. Just look online, and you will find quite a few of these companies. When you decide who to use, look at the prices and the turnaround times.

[RogerH]

The new business operating environment (in terms of the New Companies Act which comes into effect later in the year (2010)) is effectively doing away with cc's and making it far easier for small companies to get started and operate. I would caution against starting a business in a cc right now and advise doing so in a company up front - the New Companies Act will effectively treat existing cc's like companies anyway...

In addition company structures (which are based on a separation of ownershop and control) are far more robust and sustainable as your company grows - which is what I am sure you are planning...

[Dave A]

Is CIPRO still accepting registration of new CC's? For some odd reason I thought that was over already.

[RogerH]

Dave, I agree there are mixed messages currently about whether one can still register a cc - I suspect that the only cc's in the market are those already "on the shelf" with accountants and the like... it also does appear that once the New Companies Act comes into play (later in the year) any changes to a cc will trigger a conversion into a company so these shelf cc's will effectively become "worthless"... if I hear anything more I will post it...

[Pap_sak]

While on the topic....

I am a sole prop, and quite happy with it so far. Need to now register for vat - if I would do the convert from sole prop to pty/cc, now would be the time. But, so far, only see negatives with regards to tax - am I being stupid?

I do, now, have a bookkeeper and 4 staff, and am in retail.

[Dave A]

Having your business out of your personal hands and in its own legal entity should increase your options to optimize your tax affairs, not make it worse.

[Mike4166]

Hi Dave

I have read a few of the comments about CIPRO, but am Finding it very hard to change directors. CIPRO seems to be so backed logged and this is effecting my trade with suppliers and banks. any ideas on how to speed up this process, its driving me nuts
thanks
mike

[Dave A]

Mike, that sort of transaction needs a verified user to do online last I checked. Because becoming a verified user with CIPRO is such a PITA, I just toss it to my auditors to transact and bite the bullet on the fee (they rush me about R342.00 on top of the CIPRO transaction fee so no biggie).

After all, how often does the typical company change directors.

[Mike4166]

Hi Dave
It all started with our auditor as he is an agent for CIPRO and in all fairness the system is there but the end result being to have the correct directors listed seems never ending.
just as a matter of interest what made you start this forum?