How to Start a Business in South Africa

According to the World Bank, South Africa is an upper-middle income economy, and is considered to be a newly industrialized country. This is owing to its history with apartheid  which discouraged international investors from investing in the economy for several decades. Even at that, Its economy is the second largest in Africa, and the 28th-largest in the world. In terms of purchasing power, South Africa has the seventh-highest per capita income in Africa. South Africa has been identified as a middle power in international affairs, and maintains significant regional influence. With many natural resources in its territory, South Africa might just have the enabling environment for you to invest.
Are you willing to have your share of the southern cake? The following steps are just what you need to take:

Register your business

As obtainable in every other nation, you need to register your company with South Africa's Companies and Intellectual Property Commission (CIPC). The contact telephone number of the commission is 086 100 2472 and +27 12 394 9973 for international callers. if you are in South Africa, the contact address is at the DTI Campus (Block F - Entfutfukweni) 77 Meintjies Street Sunnyside, Pretoria.  According to the law of the land, you are required to provide CIPC with the Notice of Incorporation (CoR 14.1) and the Memorandum of Incorporation (MOI) (CoR 15.1 A-E).

To facilitate your registration, it is advisable that you have filled these forms before walking to the CIPC office. So take your time to download the forms. What information are you expected to supply via the form? While filling the notice of incorporation form, you are expected to explain the type of company you are operating, the date the company was incorporated. Also, the registered address of the company along with the names of directors you have. This must be a list of four names. It is the responsibility of the CIPC to check the authenticity of these names.

 

In the memorandum of incorporation form, look out to supply the following information: Details of incorporators, Number of directors or alternate directors, and Share capital (maximum issued) While submitting the forms, the one applying for registration is expected to provide photocopies and original documents of all indicated initial directors and incorporators.  Certified ID copy of applicant, if it is not the same as one of the indicated initial directors or incorporators.

If an incorporator is a juristic person, a power of attorney is needed for the one representing him in the process of incorporating the company. If another person incorporates the company and signs all related documents on behalf of any of the incorporators and initial directors, a power of attorney and certified ID copy of the person must be provided. If a name was reserved before filing of incorporation documents, the valid name reservation document is necessary.
If the business name that the prospective investor submitted is rejected to avoid duplicating an existing name, all hope is not lost. The company will still be registered but the reg number will become the name of the company at incorporation. A new name may then be submitted for approval at a later date. Meanwhile the  investor need to get an application to reserve a name (Form CoR 9.1). This can be obtained and submitted either electronically or manually. It is not possible for you to change your name as an applicant when getting an approved name for your organization.

Open a Bank Account

It is mandatory that a corporate bank account is opened immediately you get done with the registration. As a matter of fact, opening a bank account is a part of the registration process. While opening the account, It is required that you submit the original evidence of the directors identity and the original documents of the company. Care needs to be taken so that an investor does not start banking with a bank that is not reliable. While this article is not intended to endorse any bank, the following banks may serve your needs at the verge of company registration and thereafter: First National Bank, Nedbank of South Africa, Standard Bank, Capitec and Absa. Again, this is neither a recommendation nor an endorsement.

Register with SARS

The South African Revenue Service has the responsibility of ensuring that you register for your company's income tax, values added tax and employee withholding tax. The company is mandated to register as an employer by means of "EMP 101e". This form details the necessary registration of all the withholding taxes applicable to the taxpayer who is your employee.  It  is especially mandatory for business with annual taxable income of up to and more than $100,000 to get a form labeled VAT 101.

While this can be downloaded electronically, you can also get it at the address of SARS situated at 299 Bronkhorst St, Pretoria 0181, South Africa. Telephone number is +27 12 422 4000. To verify the authenticity of your claims, SARS will, alongside the representative of your organisation, carry out a physical audit of your assets. This process that usually lasts for up to 12 days will attract no extra charges.

Register with the Department of Labor

The next step that you are expected to take is registering for unemployment insurance at the Department of Labor. In doing this, the company is expected to submit the UI-8 & UI-19 application forms. After the application has been approved, the department issues a form labeled UI-33 to confirm that you have been registered. The registration at the department of labor is done without charges. Registration forms can be obtained from the Department of Labor's Web site or at their office Room 1207, 12th Floor, 120 Plein Street, Cape Town.
Still in the department of labor jurisdiction, an investor is expected to register with the  Commissioner in deference to the Compensation for Occupational Injuries and Diseases Act. While you are allowed to proceed with your business pending the approval of this registration, you should expedite with its registration. The investor need to download, fill and submit the W.As.2 form. Thereafter, the W.As.8, W.As.6a must be filled within thirty days.

Office complex

Whether you want to buy, lease or rent a property for your business in South Africa, extra care is required on your part. There are agents parading themselves with the aim of swindling unwary investors. At any rate, the banks that you have your new bank account will be willing to guide you through the buying or renting of genuine property in south Africa if you seek their professional advice.

Budget

The cost of registering a business in South Africa is relatively cheap compared to other Sub-Saharan African Countries. It is also fluctuating. you can be sure however that the CIPC will furnish you with accurate and up-to-date information about what it will cost you to do business in their country.

Why go South?

Apart from the fact South Africa is a very large African market, the country is endowed with mineral resources that manufacturing organizations the world over sought after. Minerals like asbestos, gold, iron manganese, chrome and coals are scattered in the different regions of the nation.

South African government is relatively responsible when it comes to provision of infrastructure. South Africa currently generates more than 40,000 megawatts of electricity. So epileptic power supply being experienced in some Sub-Saharan African countries will not constitute an issue for a manufacturer. The road network in the country is also near perfect. There are numerous sectors waiting for your investment. Eventually, you will be happy that you have done business with the people of the south.

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