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In Nigeria, the Corporate Affairs Commission (CAC) plays an important role in regulating businesses and non-governmental organizations (NGOs). One of the essential obligations imposed by the CAC is the annual return filing. The aim of this article is to shed light on everything businesses and NGOs need to know about the CAC annual return filing process in Nigeria.
What is CAC Annual Return?
The CAC annual return is a mandatory ‘annual’ (as the name implies) filing required for businesses and NGOs to ensure transparency and compliance with regulatory standards. This filing is a legal requirement for all registered entities in Nigeria.
Who Needs to File?
Every registered business entity, including companies, partnerships, and NGOs are obligated to file annual returns with the CAC.
What are the Requirements for filing Annual returns?
The requirements for filing annual returns are financial statements, auditor’s reports, details of the shareholders and their interests, directors, business owner, net asset, net annual turnover, and the officer authorizing the filling. These details are filled online on the annual return section of CAC portal.
Timeline for Filing
It is expected that annual return is filed 18 months after the year of incorporation and subsequently annually. The deadline for the annual filing is before June 30th.
Benefits of Timely Annual Return Filing
Timely filing of annual returns is more than a legal obligation, it is a key factor in maintaining good standing with the CAC. Businesses and NGOs that prioritize this process demonstrate commitment to transparency and accountability, fostering trust among stakeholders.
Consequences of not Filing Annual Return
Late or non-compliance with annual return filing attracts penalties, denied access to post incorporation services, certain individuals or entities can decide not to interact with a business that has not filed annual return and the loss of good standing. Also, one of the most recent effects of not filing annual return is being scrapped out of the CAC register by April 2024.
Post incorporation services that are not accessible because of not filing annual return include applying for certified true copy of certificate, status report, memorandum & articles of association, change of director/secretary, transfer/transmission of shares, change of entity contact details.
Cost of Filing Annual Returns
| CATEGORY | FILING FEE | PENALTY FOR LATE FILING | TOTAL LATE FILING FEE |
| Business name | NGN 3000 | NGN 5000 | NGN 8000 |
| Limited liability | NGN 5000 | NGN 5000 | NGN 10,000 |
| Incorporated trustees | NGN 10,000 | NGN 5000 | NGN 15,000 |
Please note that this is exclusive of bank charges and service fee.
Conclusion
In conclusion, this guide equips businesses and NGOs in Nigeria with the knowledge needed for annual return filing with the CAC. By understanding the importance of compliance, adhering to filing timelines, and maintaining transparency, organizations can navigate the regulatory landscape, proactively address their filing obligations, and mitigate risks, ensure their continued legal standing and fostering a culture of accountability.