Sole Proprietorship

Sole proprietorship is basically business owned by one person. Unlike other forms of businesses, the procedure on how to register a sole proprietorship business in Ghana is very short and simple. The proprietor is the sole owner of the idea and has full ownership right of the business. He or she is responsible for all the debts and profits incurred in the business.

To start and run a sole proprietor business in Ghana, you first need to register your business with the Registrar General's Department (RGD). You can do this yourself or pay a qualified professional like GH Startups to register it with RGD for you.

 

Requirements

• Original identity card

• Tax Identification Number (TIN)

 

Procedure of registering a business name

The procedure for registering a business in Ghana begins with the registration of a business name. Here are the steps followed in registering a sole business name.

• Pay for a registration form A at the registrar general department and fill in your details in the registration form A.

• A well filled registration form A should then be submitted to the registrar general together with the processing fees through their user bank

• Upon completion of registration, certified true copy and registration certificate will be ready for collection.

• Having acquired your business registration certificate, you will be ready to complete the registration and start the business.

 

Requirements for registering business name

• Principle place of business

• Name of the business

• Nature of the business

• Name, postal address, nationality and other important details

 

Sole Proprietorship Business Registration Fees & Charges

• Registration of business name at 50 cedis

• Certified true copy at 10 cedis

• Filling of form D at 25 cedis

 

Other requirements for one to register a sole proprietorship business in Ghana You will need the following documents for your registration to be complete

• Registration Form A

• Re-Registration Form A

• Form D – change notification on sole business particulars.



Registration form A

This is a primary document required to register a sole proprietorship business. It is provided by the act 151 of business name registration of 1962 constitution of Ghana. This form consists of the following information:

• Business name

• General nature of the sole proprietorship business (e.g. manufacturing, service, commerce, transport, construction and others)

• Principle activity of the business

• Date of commencement of business Business location information (city, region, street, house/flat)

• Sole proprietor personal details (surname, first name, middle name, date of birth, gender, occupation, marital status e.t.c)

• Residential addresses of the business person. This includes where the proprietor live; city, street, district among other details.



Form Filling & Submission

This form must be filled by the applicant and sent to the registrar of business names via email or through post. This form must be filled accurately and honestly. Feeding false information may attract severe punishment to the applicant. Registration of business name and CTC is chargeable. Business name is charged at 50GHC while CTC is charged at GHS 10. In total, an applicant is required to pay GHS 60.



Sole proprietorship re-registration form A

As provided by act 151 of the Ghana’s 1962 constitution, sole proprietorship applicant is also required to fill the Re-registration form A. This is a legal form which goes hand in hand with registration form A. Details contained in this form include the following:

• Old registration information. This information includes (old registration number, business name, old TIN, old start date and your current taxation office)

• General nature of the business

• Principle activity Principle place of business

• Personal information (all personal details as provided in the registration form A)

• Residential addresses of sole proprietor. These include region, house, city, street e.t.c

• Postal address (all reliable postal code should be given. The form includes contacts, email, website and other existing forms of contacts)



Declaration

The final and most important step is declaration. The applicant should read to ensure that all the information given is correct. The applicant should also attach the following documents.

• Copies of registration form A

• Copies of certificate of registration

• Provide an up to date evidence of a renewed receipts.




Form D

This form is also mandatory. It is to be filled by the applicant in case of change in particulars of the business. The form contains the following details:

• Taxpayer identification number (TIN)

• Applicant’s business name

• Nature of the business

• Date when change is to be done

• Signature of the proprietor.


This form should be filled and sent to the registrar of businesses.



Pros


• Easy to start – easiest form of business ownership in Ghana. It does not require a large amount of capital like other forms of business ownership. However, the exact capital amount will depend on what you are pursuing as a business.

• The sole proprietor makes all decisions for the business. Unlike other types of businesses, these decisions are always always made on time since no consultation is needed

• All profits acquired from the business are enjoyed by the owner of the business. He/she is responsible for all the profits incurred in the business

• Sole proprietor can be assisted by a family member or relative. This cutoff on the amount of money which would have been used to pay an employee

• Easy to dissolve in case the need for it occurs

• Less papers are required in the registration and commencement of the business




Cons

• Sole proprietorship has unlimited liability. This means that the sole proprietor is responsible for all the debts of the business. In case of bankruptcy, the personal assets of the proprietor may be taken to recover the debts

• The business lacks continuity. In case of death of the sole proprietor, the business is likely to die due to poor management and decision making

• Sometimes it becomes difficult for the sole proprietor to raise capital required to start and run the business. The business can easily collapse due to lack of money for expansion