What is a Business Name?
A Business Name is a type of enterprise that is owned and run by one person and there is no legal distinction between the owner and the business entity. This means that, all the profits the business makes after all taxes are paid, belongs to you. Again, all debts or liabilities the business incures, are directly linked to you. This implies that a business name has “unlimited liability.”
What is the other common name for a Business Name?
The other name for a business name is, sole-trader. This name is commonly used in banking forms and other related forms.
What are the features of a Business Name?
- It requires only one director or shareholder to register
- Paper work involved in registering the business name is not bulky
- It’s cheaper to setup
- It’s easy to manage since there are no other people involved in the business apart from from you, the owner
- Cheap tax, most business names fall under the turn-over tax category which is only 4% of total income
- You can add a few partners at registration stage but you are still in control of the business as the sole director or shareholder
- Your personal TPIN (Tax Payer’s Identification Number) is linked to your business name
- You can open a business account with any commercial bank under the sole-trader category of businesses
- You can register your business as GRZ supplier or contractor with Zambia Public Procurement Authority – ZPPA and bid online for GRZ tenders related to your businesss undertaking
- You can register your business National Council for Construction – NCC if your business is in the construction sector and confidently bid for GRZ construction projects online on the on the ZPPA website using the e-GP sytem
- All the profits the business name makes belongs to you (as the owner) after you pay your tax dues
- All the detbs and liabilities the business incures are directly linked to you as the owner. This means that, you will have to use your other funds or resources to clear such debts or liabililities in case your business cofers are unable to settle them.
What the requirements for registering a Business Name?
- Applicant must be 18 years and above
- Applicant must be of a sound mind
- Photocopy of NRC or passport
- Trading place (it can your home address, rented shop or office space)
- Application for name clearance – the name you would like to give your business (you will be required to suggest a minmum of 3 names as you apply for name clearance, list them in order of priority)
- Completed and signed form 3 for name clearance and form 2 for registration of the business entity.
What are the fees involved in registering a Business Name?
- Name clearance fee – K83.00
- Business name registration – K166.00
- Modes of registration – Online (https://www.pacra.org.zm & https://zamportal.gov.zm) or physically walking into a PACRA service centre near you
- Duration – up to two weeks or less depending on the number of applications received PACRA
- ZRA TPIN/tax registration – free (https://www.zra.org.zm/)
- ZPPA registration – K300/year (https://www.zppa.org.zm/)
- NCC registration – K1500 express (done within a week) or K750 normal (done within a month)
NB: People or other businesses assiting you with registration of a business name are at liberty to charge you for labour, those charges are separate from the payments you will make to PACRA and others.
What are your obligations after your Business Name is registered?
- You are required to be paying annual return to PACRA every after 1 year a few days after the exact day your business name was registered or any other date of your choice at K83.00 per year
- You should be submitting your tax returns to ZRA monthly
- You should be renewing your ZPPA registration consistently
- For those in construction, you should be renewing your NCC registration consistently as well
Who can register a Business Name?
- Anyone who intends to venture into the business of supplying things without or without the need of opening a shop
- Skilled people such as carpenters, weilders, plumbers, builders, accountants, lawyers, engineers, economists, mechanics, panel beaters, artists, technicians, etc.
- Businesses such mobile money agents, salons, barbershops, boutiques, car parks, block making, transporters, private schools & clinics/surgeries, auto shops, liquor stores, super-markets, wholesale & grocery shops, butcheries, electronics shops, phone shops, etc.