Can I Still Register a Cc in South Africa?
What does CC stands for?
CC stands for Closed Corporation, a business that runs with a small number of owners to ensure complete control over its operations but does not solicit investment from the general public or list its stock on a stock exchange.
What are some examples of CC in South Africa?
1. Jab Ohs Consultants Cc
2. Counting House
3. Mphosello Investment Cc
What are the characteristics of closed corporation?
1. Members of the CC own and run the company.
2. Few people are involved in management.
3. Close Corporation information is available to its members.
4. The CC’s life span is infinite, therefore the withdrawal of a member has no effect on it.
5. Like corporations, CC is subject to double taxation, in that they are taxed on CC’s income as well as Standard Tax of Company (STC) on members’ dividends.
What are the advantages of closed corporation?
1. There are less formalities/rules to observe.
2. Shareholders’ liability is limited.
3. Increased shareholder control over shares and business.
What are the disadvantages of closed corporation?
1. CC is vulnerable to double taxation, which affects shareholder profit.
2. CC cannot seek financing from the general public during a business crisis.
3. Shareholders have greater responsibility in the management of CC.
Can I still register a CC in South Africa?
The implementation of the new Companies Act (Act 71 of 2008) demands that no CC can be registered and that no conversions from Companies to CCs will be allowed in South Africa.
Why were close corporations discontinued in South Africa?
The new law caters for smaller businesses as it provides that those entities will not automatically be subject to strict financial reporting and auditing requirements. There will therefore be no need for close corporations.
