How To File Annual Returns In Nigeria

How To File Annual Returns In Nigeria

Annual returns are the financial statements that Nigerian companies are required to file with the Corporate Affairs Commission (CAC) at the end of every fiscal year. These returns provide information on the financial status of the company and help to ensure that it is operating in compliance with the law. For many business owners, filing annual returns can be a daunting task, but it doesn't have to be. In this article, we'll provide a step-by-step guide on how to file annual returns in Nigeria.

What Is An Annual Return?

An annual return is a document that companies are required to file with the CAC each year. This document provides information on the company's financial status and ensures that it is operating in compliance with the law. The annual return includes information on the company's shareholders, directors, and accounts.

Why Is It Important To File Annual Returns?

Filing annual returns is an important legal obligation for Nigerian companies. Failure to file annual returns can result in penalties and fines. Additionally, companies that fail to file annual returns may be struck off the register of companies, which can have serious consequences for the business.

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When Should You File Annual Returns?

Companies are required to file annual returns with the CAC within 42 days after the company's Annual General Meeting (AGM). The AGM must be held within six months of the end of the company's financial year.

What Information Do You Need To File Annual Returns?

To file annual returns, you will need to provide the following information:

  • Company name
  • Registered office address
  • Business address
  • Email address
  • Phone number
  • Names and addresses of directors
  • Details of shareholders
  • Financial statements for the year

Step-By-Step Guide To Filing Annual Returns In Nigeria

  1. Determine the deadline for filing: The deadline for filing annual returns is 42 days after the company's AGM.

  2. Prepare the financial statements: The financial statements should include a profit and loss statement, balance sheet, and cash flow statement.

  3. Submit the financial statements to the auditor for review: The auditor will review the financial statements and provide an audit report.

  4. Hold the Annual General Meeting (AGM): The AGM must be held within six months of the end of the company's financial year.

  5. Prepare and sign the annual return: The annual return should be prepared and signed by the directors of the company.

  6. Submit the annual return to the CAC: The annual return should be submitted to the CAC within 42 days after the AGM.

Common Errors To Avoid When Filing Annual Returns

  1. Filing late: Late filing can result in penalties and fines. Make sure to file the annual return within 42 days after the AGM.

  2. Providing incomplete information: The annual return should include all the required information, including financial statements and details of shareholders and directors.

  3. Failing to hold an AGM: The AGM must be held within six months of the end of the company's financial year.

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Conclusion

Filing annual returns is an important legal obligation for Nigerian companies. By following the step-by-step guide outlined in this article, you can ensure that your company is in compliance with the law and avoid penalties and fines. Remember to file the annual return within 42 days after the AGM, provide complete information, and hold the AGM within six months of the end of the financial year.

FAQs

  1. What happens if I fail to file annual returns on time?

Failure to file annual returns on time can result in penalties and fines, and your company may be struck off the register of companies.

  1. How often do I need to file annual returns?

Annual returns must be filed with the CAC once a year.

  1. Can I file annual returns online?

Yes, you can file annual returns online using the CAC's e-registration portal.

  1. What is the penalty for late filing of annual returns?

The penalty for late filing of annual returns is N5,000 for the first 14 days and N1,000 for each subsequent day.

  1. When can I expect to receive confirmation that my annual return has been filed?

You should receive confirmation that your annual return has been filed within a few days of submitting it to the CAC.