The Only Way Is Ghana has partnered with Swift Law, a legal tech platform that allows its clients to register a company (in a week!) or intellectual property in Ghana simply by filling out a online form. Swift Law will be providing you with 6 steps to setting up a business in Ghana, this and every Thursday for the next 5 weeks, so stay tuned for this vital information.
If you have any pressing questions they are also on hand to answer your related questions in The Only Way Is Ghana forum.
Doing business in Africa is never an easy task so to have honest people/company to help facilitate this process can be invaluable.
So step 1 is…
Choose the right legal business entity
It is important to choose the right legal entity to meet the specific needs of your business.
Depending on your business needs there are 6 main types of legal entities you may form in Ghana.
1. Company Limited by Shares – This is a business entity registered at the Registrar General’s Department comprising at least two individuals acting as directors of the company and at least one person (company or individual) acting as a shareholder in the entity with objects which are (usually) for the generation of profit. The liability of the members of this entity are limited by the value of their shares.
2. Company Limited by Guarantee – This company structure is best suited for Not-For-Profit Organisations. This is because the objects of a company limited by guarantee cannot include any for the generation of profit. As such these companies are exempt from corporate tax (although the organisation will have to pay income tax on behalf of any its salaried employees)
The Company Limited by Shares and Company Limited by Guarantee are jointly referred to as “ Limited Liability Companies” this is because the personal assets of a persons who form such entities are protected from liability. In other words the liability of members of such a company is limited.
3. Company Unlimited by Shares – This is a business entity registered at the Registrar general’s department comprising at least two individuals acting as directors of the company and at least one person (company or individual) acting as a shareholder in the entity with objects which are (usually) for the generation of profit. The liability of the members of this entity are not limited by the value of their shares. It is typically used for entities that give professional advice and services such as law firms.
4. Sole Proprietorship – This is an entity exclusively owned by an individual who is entitled to all the profits of the business and personally liable for all liabilities of the business . In Ghana such entities are not required to be incorporated at the Registrar General’s Department (RGD). If the owner of this entity would like to operate under a business name it is however required to register such business name at the RGD.
5. External Company – An external company is a corporate body registered outside of Ghana which has a place of business in Ghana. Although an external company is subject to Ghanaian tax laws (income& corporate tax), such a company is regulated by the laws of the country in which it was originally incorporated in.
6. Incorporated Partnership – Where two or more people (up to a maximum of 20) decide to go into business for the generation of profit together, they may decide to do so through an incorporated partnership registered at the RGD. There is no protection of a partners personal assets in an incorporated partnership. The acts of one partner binds the whole partnership.
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Our focus for this 6 week course will be on a limited liability company, although the process is largely similar for the other legal entities.
If you have any questions related to registering or setting up a business in Ghana, Swift Law they are on hand to answer your questions in The Only Way Is Ghana forum.