1. Choose your Limited General Supplies company name to register. You need to submit 3 names to registrar of companies.
2. Start a Personal E-citizen Account for companies registration
3. Select your Business Legal Entity for registration
4. Select business name or sole proprietorship registration
5. Register a private limited Business/ company
6. Fill in the company registration forms
7. Process KRA PIN registration for your New limited Business
1. CHOOSE YOUR SUPPLIES COMPANY NAME
Choosing your business name is therefore a very crucial endevour. There are several ways to approach the naming of your company namely:
- Using African Indigenous names
- Using English or Swahili names that emphasis on a given positive impact
The important thing is to consider the perception that the name will create to your clients. It is also wise to do some research to find out if the name is taken locally and if the domain name for the exact name is available. It’s easier for clients to find you online on google if your website domain name is exactly the same as the company’s name. All one needs to do is search your name on google and your company’s website would be the first on the list.
A. INDIGENOUS NAMES
B. ENGLISH AND SWAHILI NAMES
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You can now do some research and decide which name sounds better but the most important thing is how the name sounds to a client. Bottom line, think of such things as is it easy to pronounce, is the name easy to remember and is it easy to type or write down, or does it describe a certain positive attribute. Always strive to get a name that helps to express your company’s brand.
2. OPEN A PERSONAL E-CITIZEN ACCOUNT
All you need is to open an account at ecitizen website and be sure to include your full names and ID card number when opening your account. Now that you have an ecitizen account you can start the process of registration of a supplies company.
This involves a two step process (now rolled into one) namely:
- Company Name Search and Reservation
- Application for Incorporation of a Private Limited Company
A. NAME SEARCH AND BUSINESS NAME RESERVATION
Note that it is now possible to register a business or company name with only 1 shareholder and shareholder as opposed to previous Act guidelines.
You will get a form in which to fill in the suggested name and choose what type of business you want to register e.g. Sole proprietorship, partnership or private limited company. Sole proprietorship and a partnership only require you to register a business name.
After you are sure the name is not taken, you can reserve that name pending registration into a private company. The office of the registrar of companies allows you to hold (reserve) a name for 30 days by which time you should have applied for its registration into a business name or a private limited company. On expiry of the 30 days, the reserved name reverts back to the unregistered names status and is available to be registered by any other person if you haven’t done that by then.
To make a business name reservation, you will fill in a simple online form including the proposed business name and you have to follow a set of simple rules to choose that name. Once you have done the reservation, the system will take you to a payment page where you can pay via mobile money- Mpesa.
The cost to make a single name search is Kshs 150 per name searched. The search takes a day or two for results to come out. The online system will indicate whether the name search is under review and will switch to ‘approved’ status once the name goes through.
After your proposed business name goes through and is reserved, you can now use it to make an application online for a Private limited company or business name. I always advice clients that it’s better to register a General Supplies company under a private limited company as opposed to just a business name.
3. SELECT YOUR BUSINESS LEGAL ENTITY
These three legal entities to consider include:
- Sole Proprietorship Business name
- Partnership Business Name
- Private Limited Company
4. REGISTER A SOLE PROPRIETORSHIP AND PARTNERSHIP BUSINESS NAMES
1. Name of Business – A name search needs to be performed first as part of the registration process. You will need to write a letter requesting for a name search to be performed. This can be done at Company Registry. However, if you perform a name search through eCitizen, you won’t need to write a letter. You will only need to enter the business name and pay for the name search.
2. Nature of business – You will need to come up with one specific nature of business e.g. Tours & Travel, Computer Repairs, Mobile Phone & Accessories Shop etc. General words such as “shop” or “retail”, trade” are not sufficient for Company Registry to proceed to register your business. You will need to avoid things like “General Supplies” which is popularly used but it will not be approved.
3. Address of the principal place of business – (Plot No., Section and Name of Street or Road, Name of Building) – For the plot number, please find the electricity bill or water bill of your business premises. If you don’t have a business premises, you can use your home residential plot number/land reference number for registration that’s if you are starting your business from home, but you will need to update the records at Company Registry once you have a Business Premises.
4. Postal Address – If you don’t have one, you can register your very own postal office box for Ksh. 2,500 at the nearest Postal Office or ask a family or friend to allow you to use their P.O. Box temporary for the application then later on update your registration certificate.
5. Address of any other place of business (Branch Office under the above name) – Only applicable to businesses that are currently operating business in other counties or have other branches under the same business name.
6. Full Names of you and any other partners – Any person who has changed his/her name must give all former names, unless the change occurred before he/she attained the age of two years.
Avoid using abbreviation in your name as this is not legally recognised. For example names like Robert M. Kamau instead it should be like Robert Muhinga Kamau. This will save you time and money.
For Sole Proprietor Business, it only requires 1 person. For Partnership Business, it only require minimum of 2 people and maximum of 20 people).
7. Nationality – You will require to enter your nationality as indicated on your identification e.g. Kenyan, German, British, American, Chinese, South African etc.
8. Age – Make sure you give your correct age based on your ID/Passport
9. Gender – Male (M) or Female (F).
10. Usual place of residence -Where you currently reside e.g. Nairobi, Nakuru, Kisumu, London, Paris, Hong Kong etc.
11. Other business occupation – You will need to enter your occupation e.g. engineer, farmer, hair stylist, web designer etc. If you don’t have one you can simply write either “Businessman” or “Businesswoman”.
12. Signature on the document (usually at the back page of the BN2 Form)
13. Copy of ID/Passport
14. Copy of KRA PIN Certificate
15. Passport Photo
16. Download the filled-in forms for signatures and upload the signed scanned copies. Submit the application and pay the fee of Kshs 1,000 via mpesa or credit card following the payment instructions.
Registration takes a 1-2 days and certificate will be available on the eCitizen platform for download and printing.
5. REGISTER A PRIVATE LIMITED COMPANY
Once the directors have signed the application forms, you will then scan these forms and upload them again onto the system and then make payment via Mpesa to complete the application process. The application for a private limited company involves filling in the below forms
- CR1 – The Company registration form (Main application form with company & directors info)
- CR2 – Model Memorandum of a Company (Indicates the shareholding of each director and type of shares issued)
- CR 8 – Notice of Residential Address of the Directors (indicates current directors home addresses
- Statement of Nominal Capital (states the total value of shares on start up and stamp duty paid)
A. CR1 – COMPANY REGISTRATION FORM
The CR1 form has several sections which you will fill in including the below:
- Name of the company
- Type of the company
- State whether company is adopting the universal articles of association or will submit its own
- Target business registration date
- Number of employees
- Physical address of the office location
- Contact Address of the company
- Details of the Director(s) including Names, postal addresses, id card numbers, telephone numbers, email addresses, and signatures of each.
- Primary business activity of the company
- Type of liability of Directors
- Share Capital and nominal value of issued shares
- Other details of company ownership structure subsidiary, holding company, Acquisition or amalgamation etc.
B. CR2 – MODEL MEMORANDUM OF COMPANY
The details you have to fill in this form include:
- Name of the subscriber
- Postal addresses of the subscriber
- Occupation of the subscriber
- Number of shares taken by each subscriber
- Nominal value of shares taken by each subscriber
- Class of shares taken
- Signature of each subscriber
Note that you no longer need to prepare a memorandum or articles of association for a company. Instead, you only adopt the generalized ones. This means that you no longer have to submit the objectives of the company and as such there is absolutely no reason to engage a lawyer as the process is all online and takes 1 week at most.
C. CR8 – NOTICE OF RESIDENTIAL ADDRESS OF THE DIRECTORS
The CR8 form has section including:
- Name of the Company
- Name of the directors
- Residential addresses of each director
- Details of person lodging the form
D. STATEMENT OF NOMINAL CAPITAL
Most small companies should start with atleast 1000 shares issues each valued at Kshs 100. So the nominal capital of such a company will be:
1000 shares x kshs 100 = Kshs 100,000.
The Kshs 100,000 is the value of the company shares at the start of the company. And it is against this capital that the stamp duty will be calculated using the formula (shillings twenty for every Sh. 2,000 or fraction of Sh 2,000)
6. FILL-IN THE COMPANY REGISTRATION FORMS AND SUBMITTING
After completing the forms, you will be required to attach the following 3 items before you submit the application:
- Copies of ID Cards of each of the Directors of the company
- Copies of Kenya Revenue Authority –PIN certificates of each director of the company
- Copies of Passport Size photos of each Director of the company
Once done, the system will develop final copies of all the forms above in pdf format and avail them to you to download for signatures. You can now download and print the 4 pdf forms and take to the directors for signatures and proof reading.
Once you complete this process, you can now scan the final documents which have been signed by the directors and upload them into the system. Once done, the system will take you to a payment page where you will be expected to pay the registration fee of Kshs 10,650 via mobile money – Mpesa.
The system auto-generates a receipt and your application will go through a review process. It may take a week and your system will either show approved or rejected with corrections. You can make any corrections online and resubmit if your forms had a problem. If your application is successful, you will get a Certificate of Incorporation for the company sent to your ecitizen account. You can then print it. It’s legal and formal to be used in opening a company bank account or getting a trade license from the General Supplies.
7. REGISTER FOR KRA PIN
- Certificate of Incorporation
- Model Memorandum of Association of the Company –CR2
- Notice of the Residential address of the directors – CR8
Upon receiving the company certificate and your memorandum and CR8, you will need to go to iTax KRA portal and load data to register your general supplies company’s for a PIN Certificate online. To start the process, go here: https://itax.kra.go.ke/KRA-Portal/
Once you have company KRA PIN, certificate of incorporation, memorandum and Notice of Directors residential addresses, then you’ll have everything to open a bank account for your business so you can start trading.