Starting a business in Ghana does not just begin with a business idea unless you plan to run the risk of running an unregistered business and losing out of the many advantages of a registered business.
First Choose The Sector You Want to Invest In
As of 2019, Ghana has an estimated population of 30.10 million, which ranks 48th in the world. More than 2.8 million Ghanaians, representing about 10 per cent of the population, are currently living in extreme poverty. That is, these 2.8 million people are living below the global poverty line of a $1.9 spending a day. Of its current population, the percentage of rural population in Ghana as of 2016 is 45.32 % 2016, according to the World Bank collection of development indicators, meaning that about more that 12.8 million Ghanaians live in rural areas. Thus, the rest of over 17 million people live in towns or other places, with over two million people living in Accra and Kumasi and appreciable numbers living in Ashanti, Sekondi-Takoradi, Ashaiman, Sunyani, Brong-Ahafo, Tamale, Cape Coast, Obuasi and others. This statistics is very important in deciding where to locate your business to get appreciable returns on your investment. Major areas of investment in Ghana include Agriculture & Agro-Processing, Cotton & Textiles, Food Processing, Forestry, Health, Mineral Processing, Oil & Gas, Tourism, Utilities, among others. Agriculture accounts for about 42% of GDP and employs more than half of the workforce, mainly small landholders.
Proceed to Register Your Business
Registering your business in Ghana is easy if you are a local. Companies may be registered in Ghana, either as:
- Limited Liability Companies (
- Companies Limited By Guarantee
- External Company (External Companiesare companies that are incorporated outside of Ghana with a registered place of business in Ghana. They are regulated by the laws of the country in which they were originally incorporated. For example, British company may incorporate its business in Britain but has its registered place of business in Ghana)
- Partnership; or
- Business Names ( Between 2015-2018, Ghana had 67% registered Sole Proprietorship, 24% registered Companies Limited by Shares, 8% registered Companies Limited by Guarantee, 0% registered Partnership, 0% registered External Companies)
Ghana uses Regulations of Companies in place of Memorandum of Association which contains the Object Clause and Articles of Association.
In Ghana, you must have a TIN to register your business.
(TIN is also required to do business with the Ghana Revenue Authority (GRA); open a bank account; register your vehicle; get a passport; register land; clear goods from a port or airport; file a case at the court; get a drivers’ licence). Where it is a company that is sought to be registered, Taxpayer Identification Number (TIN) registration must first be obtained for all company directors, secretary and shareholders.
When this has been done, then you go online here.
Registration of businesses and companies is primarily the functions of the Registrar General’s Department under Ghana’s Ministry of Justice and Attorney General.
The portal is also integrated with the Ghana Revenue Authority e-tax portal and both make use of the Tax Identification Number (TIN) to identify portal users. Little wonder Ghana is the ranked 114th country out of 190 countries and the 14th African country in the ease of doing business, according to the latest World Bank annual ratings, ahead of Egypt, Ivory Coast and Nigeria. At the end of the business registration, a Certificate of Incorporation and a Certificate to Commence Business are issued. Registration of businesses takes approximately 2 weeks in Ghana.
For foreign investors or businesses, they are required to complete Investor Registration Forms (Form GIPC/R1) in duplicate, after the registration with the Registrar General’s Department. Within five (5) days from the date of orderly receipt of these forms (and its attachments) the GIPC will formally register the investment.
TAXATION OF BUSINESSES IN GHANA
Businesses in Ghana are taxed according to the sectors they belong to. Withholding Tax, Personal Income Tax and Company Income Tax and other sector taxes are applicable in Ghana. However, areas such as Capital investments ( for investment in capital projects like infrastructure, etc,), Free zone developers/enterprises, Construction of residential premise, receive 1% to 15% tax incentives.
Under the Ghana Investments Promotion Centre Act, 2013 (Act 865), there are incentives to encourage major investments in the country, especially in the agriculture; manufacturing industries who deal in export trade or use local raw materials or produce agricultural equipment, etc.; construction and building industries; mining; and tourism.
Incentives range from exemption from customs import duties on plant and machinery; reduced CIT rates; more favourable investment and capital allowances on plant and machinery; reduction in the actual CIT payable, where appropriate; retention of foreign exchange earnings, where necessary; guaranteed free transfer of dividends or net profits, foreign capital, loan servicing, and fees and charges in respect of technology transfer; and guarantees against expropriation by the government.
Charles Rapulu Udoh
Charles Rapulu Udoh is a Lagos-based Lawyer with special focus on Business Law, Intellectual Property Rights, Entertainment and Technology Law. He is also an award-winning writer. Working for notable organizations so far has exposed him to some of industry best practices in business, finance strategies, law, dispute resolution, and data analytics both in Nigeria and across the world.
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