Registering a business in Ghana: sole proprietor or company?
The two most common ways to start trading, what each one means for your liability, and how registration works.
· 2 min read
Before trading under a name, a business in Ghana must be registered with the Office of the Registrar of Companies. The main choice is between a sole proprietorship and a limited liability company.
Sole proprietorship
A sole proprietor registers a business name under the Registration of Business Names Act, 1962 (Act 151). It is quick and cheap, but the business and the owner are the same person in law: the owner is personally liable for all of the business's debts.
Company limited by shares
A company registered under the Companies Act, 2019 (Act 992) is a separate legal person. Shareholders' liability is generally limited to what they have agreed to pay for their shares. In return, a company must keep records, file annual returns and meet the Act's governance rules.
Tax registration
Individuals use their Ghana Card number as their taxpayer identification number. Businesses must also register with the Ghana Revenue Authority, and for VAT once they pass the registration threshold.
Which to choose
A small, low-risk trade can start as a sole proprietorship. Where there are several owners, outside investors, larger contracts or real exposure to claims, a company is usually the better structure.
Sources
- Registration of Business Names Act, 1962 (Act 151)
- Companies Act, 2019 (Act 992)
- Office of the Registrar of Companies
- Ghana Revenue Authority
This article is general information about Ghanaian law, not legal advice. Speak to a lawyer about your own situation.
This article is general information, not legal advice. Please contact us about your own situation.
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