Among the best option you have done is deciding to be an entrepreneur. By becoming an entrepreneur, you have already demonstrated your leadership trait and the drive to see your idea materialize. You have decided to take the next major step to realize your vision, that is, register your business, but don’t forget, this process involves key stages that need some careful consideration. The following article is an overview of the basics to ponder when you decide to register your business.
Who can apply?
Any individual who is at least eighteen (18) years old, who is doing business or proposing to do business in the United Republic of Tanzania under a business name are required to register under the Business Activities Registration Act, 2007 .
The Business Activities Registration Act, 2007 requires that all business whether sole proprietorship/individual or partnership/corporation should obtain a certificate of registration from the business registration centre in respect of every business.
How to apply for a Business Name
Choose a Business Name
Remember that your business name should describe the nature of your business. Business Registration and Licensing Authority (Brela) is responsible for business name registration.
Apply for the proposed business name by submitting three names. Submitting three names aims to ensure that your business name doesn’t coincide with already existing business names. The good thing is that business registration can now be done online by visiting Brela website.
The name you choose for your business, while being unique and relevant for your business, requires Brela’s approval. Choose a name that is not obscene or vulgar. It must not infringe with any trademark or be too similar or identical to that of any existing companies. The approval process is fast, within a day, however if the chosen name includes certain restricted words involving regulated and strategic sectors such as bank, law, finance, media etc then the relevant government agency or authority will need to review it. In such cases the approval may be delayed by a few days.
To avoid any delay or disappointments, check availability before choosing a name. You may do it online on Brela’s website. Make sure that the name you choose is representative of your business philosophy, nature, product or service and positioning.
Make sure that you choose the right name. Choosing the right name for your new business is extremely important because it distinguishes your products and services from those of your competitors, and helps to establish your identity in the marketplace.
After your business is registered, you will receive a notification confirming your registration then the applicant is supposed to prepare a memorandum and articles of association and submits to BRELA.
This process is free off-charge. Further information on business registration and name clearance can be obtained at www.brela.go.tz.
Have a registered Address
At the time of registration you will have to provide a local physical address. All official notices and correspondence will be sent to this address only. Local Government Authorities of which your business is to operate must approve the premises for commercial use.
If you are a small business owner or decide to operate from your house to save on office rental expenses in the initial years, then permission for such use must be obtained the Tanzania Bureau of Standards (TBS) and from the Tanzania Food and Drugs Authority (TFDA).
Apply for Taxpayer Identification Number (TIN) at Tanzania Revenue Authority.
TIN registration is free of charge. It takes a minimum of 1- 2 days to obtain a TIN number, depending on the number of requests made to the Revenue Authority (TRA) at the time. The Certificate of incorporation shall be attached to the TIN application enclosed with Memorandum and Articles of Associations when a person makes application to TRA.
The limited company shall apply for TIN certificate by filling TIN application forms as follows:
- Application for the company
- Application for each shareholders/directors, in case any director has already issued with TIN certificates for other purpose he/she cannot make another application. The same TIN number will be used.
- At least one of the directors of the company must be physically present at the tax office to give their fingerprints (biometric data). The applicant must visit TRA offices to pick up the TIN number in person. The company will be required to declare its estimated income or turnover for the provision tax assessment for the particular year. At the TRA office, the tax officer may interview the company founders/directors and record their business and personal particulars.
Apply for Business license at the Ministry of Industry, Trade and Investment (MITI) and Local Government Authorities (LGAs)
The business license is either issued by the Ministry of Industry, Trade and Investment or the Local Authorities depending on the nature of the business. Together with the application, the following documents must be submitted:
Certificate of incorporation
Memorandum and Articles of Association
Proof of Tanzanian Citizenship
Proof of a suitable company premises
Taxpayer Identification Number (TIN)
Apply for Value Added Tax (VAT) certificate at the Tanzania Revenue Authority
Every business that has an initial capital registration of Sh50 million for the first six months of a business or 100 millions in a year are required to register for value added tax. The tax is not directly affecting MSMEs but rather incurred by the last consumer. To register for vat one has to go to the nearby TRA office to obtain papers for registration. The registration applies to all with exception of those businesses offering professional expertise services. Another registration option is through TRA’s website.
Prepared by Veneranda Sumila
Tanzania Private Sector Foundation (TPSF)
If you want more information about Business Management Tips and templates please visit http://enterpreneurs.or.tz/business-management/