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FAQ's
When will the new Companies Act become effective?
The proposed date has now been moved out to October 2010. However, there is a lot wrong with the new Act that needs to be rectified, the Department of Trade and Industry has not released the new forms as yet and the Companies and Intellectual Property Registration Office is hopelessly inefficient and will never cope with what the introduction of the new Act will require of it, so hopefully all that will be sorted out first and the Act will only come into effect next year.
What is CIPRO?
CIPRO is the Companies and Intellectual Property Registration Office and is situated in Pretoria. It is the body that keeps a database of all companies, close corporations, co-operatives, trade marks and patents in South Africa. It also is the sole entity that is able to register companies, close corporations and co-operatives. There are moved afoot to for CIPRO to open branches in Cape Town and Durban but this has not happened yet. When the Companies Act 2008 comes into being possible towards the end of this year but the date is still uncertain, CIPRO will be changed into a Commission and given stronger “teeth”. Visit CIPRO’s website on www.cipro.gov.za but be prepared for a frustrating experience.
I want to register a company or a close corporation, can I do it without assistance.
Yes, you can. Just be aware that while everything may go smoothly, if you encounter problems it can be a very frustrating experience resolving them. Problems could include CIPRO losing your documents (happens fairly regularly), CIPRO sending documents to the wrong address; or the documents are rejected for some reason and you are not sure what you must do to correct them. You can call CIPRO on their call-centre number for advice but call-centre staff are not trained in company secretarial work and they are not in the same building as CIPRO. You can also visit CIPRO’s website for more information. Do check out their processing times because these can vary enormously from a few days to a few weeks or months. If you get stuck, contact us. Alternatively, it’s much simpler for you to let us do it for you.
How do I go about it?
Very simplistically, you must do the following:
- Go onto CIPRO’s website and open a customer account;
- Deposit the necessary funds into the account;
- Reserve a name;
- Once you have received confirmation of the name approval, prepare the necessary documentation;
- Send your signed documents to CIPRO (make sure you keep a copy and that you obtain proof of delivery);
- Wait for CIPRO to return your processed documents to you.
Is Government going to do away with CC’s?
No, close corporations are not being done away with, but once the new Companies Act 2008 comes into being it will no longer be possible to register a new CC. However, all CC’s then in existence will be able to continue until they are deregistered or wound up by the members in the course of time.
When are annual returns due?
Annual returns for all companies and close corporations are due in the month following the month of registration, so if your company was registered in the month of August, your annual return will be due before the end of September.
How much is the annual duty?
Annual duty is based on turnover and is as follows:
• For public companies – a flat R4 000 irrespective of turnover.
• For private companies:
Turnover between R0 – R10 million the duty is R450
Turnover between R10 million and R50 million the duty is R2 500
Turnover above R50 million the duty is R4 000.
How do you lodge an annual return?
Annual Returns can only be lodged through CIPRO’s website. You need to register as a customer with CIPRO in order to lodge an annual return. You pay the annual duty into your customer account and CIPRO extracts it when you submit the return. We can lodge your annual returns for you.
If my company is in deregistration what can I do about it?
If your company is "in deregistration" due to not having lodged annual returns, you must first advise CIPRO that you are wanting to lodge the returns and pay the duty and they will then give you access to the company.
Your forms for CC registrations specify an Accounting Officer. What is his function?
An Accounting Officer must be appointed by law to sign-off the close corporation’s financial statements at the end of the financial year. The Accounting Officer must belong to one of the professional qualifications specified in the Close Corporations Act and have a registration number from that particular professional body.
What is a Public Officer?
The appointment of a Public Officer is a requirement of the Income Tax Act and is the person in the company or CC who is responsible to SARS for the company or CC’s tax affairs.
If I am registering a CC or company, when can I apply for a VAT number?
Once your company or CC has been registered and you have a registration number your first step is to open a bank account in the name of the enterprise. You will need to convince SARS that you are a trading enterprise, complete the necessary forms which are obtainable from SARS website, and then visit your nearest SARS office to register.
Can a trust be a member of a CC?
Yes, it can, as long as the total number of members, plus the beneficiaries of the trust, does not exceed 10.
Is it true that I have to pay transfer duty to SARS if I buy shares in a company?
Yes it is. In terms of the Securities Transfer Act there is duty in the amount of 25% (point 25 percent) of the total purchase price to be paid on the transfer of shares. It must be paid by the end of the second full month following the date of transfer.
What are the advantages of buying a Shelf CC or company?
There is no real advantage in buying a Shelf CC. CIPRO takes much longer to process a form CK2 (Amended Founding Statement) than it does to register a Founding Statement (form CK1) due to the sheer volume of CK2’s that it has to process. The reason for this is that a CK1 is only used once, on formation of the CC. For every other change a form CK2 is used. A new registration is therefore quicker. The only time you might need a Shelf is when it does not matter what the name of the CC is, and you need a registration number urgently for a tender or property purchase.
Where a company is concerned, a Shelf company is definitely an advantage, because with electronic lodgements, ownership can be changed within 24 hours.
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