Registering a Business Name in Kenya

This is the simplest form of a business entity where a person is solely responsible for owning and operating the business. A business name is not a legal entity in Kenya.

This means your business assets and liabilities are not separate from your personal assets and liabilities. You can be held personally liable for the debts and obligations of the business.

Registering a business name (sole proprietorship) can be a good choice for low-risk businesses and owners who want to test their business idea before forming a more formal business structure.

Some examples of business name registration include registering as :

1. Sole Proprietorship: This is the simplest form of a business name registration where one person (proprietor) is solely responsible for owning and operating the business.
2. Partnership:  A partnership involves two or more individuals (partners) who agree to share profits and losses in a business. You can register with two or more people.

You are ready to proceed with the registration process once you have prepared the necessary requirements. To register, you will need the following:

1. National ID: National ID card of the business owner.
2. KRA PIN Certificate:  KRA PIN Certificate of the business owner.
3. Passport Photo: Provide passport-sized photos of the business owner.
4. Registered office and business owner address details : Provide details of the business owner and the registered office address.
5. Duly Signed BN-2 Form : Upon successfully filling out the registration form, please download, print, sign, and upload the BN-2 Form.

Registration can be done either through the eCitizen portal online or by visiting any Huduma center.

To register a business name in Kenya, you will need to follow these steps and meet the requirements:

STEP-1 eCitizen Portal : You can visit the official eCitizen portal online to complete the business name registration.

STEP-2 Choose a Unique Name : Choosing a unique, memorable, and relevant business name is crucial for registering and establishing your brand identity.

STEP-3 Name Search and Reservation : The first step in filling out the registration form is to conduct a name search to check name availability. Enter at least three proposed names in order of priority.

STEP-4 Complete the Registration Forms :  After submitting the proposed name search in order of priority, proceed by filling out the form with information such as the nature of the business, registered business address, ownership address, etc.

STEP- 5 Submit Required Documents : Once you have completed filling out the form correctly, download, sign, and upload the BN 2 Form. Please confirm your declaration of submitting all the required documents.

STEP-6 Pay Registration Fees: To pay registration fees, you have the option to use mobile money, credit/debit cards, or online banking from local banks.

The cost for registering a business name is Kshs 950.

As a business owner registered under a business name, you will need to:

• Keep business records and records of expenses.
• Send a Self Assessment tax return every year.
• Pay Income Tax on your profits.
• You must register for VAT if your monthly turnover sales is over KES 5 million . You can register voluntarily if it suits your business, for example, if you sell to other VAT-registered businesses and want to reclaim the VAT.
• If your business is operating in specific sectors, you must obtain relevant permits from regulatory bodies.

Registering a business name in Kenya offers several benefits that can greatly enhance the credibility and growth of your business. Here are some of the key advantages:

• M-Pesa Business Till Number and Paybill Number : Enables a business to obtain an M-Pesa Business Till Number and Paybill Number, facilitating seamless mobile payments and enhancing customer convenience.
• Bank Account Opening : Opening a dedicated business bank account not only streamlines financial transactions but also instills credibility in the eyes of clients and partners.
• Tenders and Contracts : It provides access and opportunities for applying for government tenders and contracts. Many procurement processes require businesses to be formally registered, making it essential for those seeking public sector opportunities.
• Brand Name Protection: By securing a registered business name, entrepreneurs can safeguard their brand identity from infringement or misuse.
• Loans and Financial Incentives: Businesses that are officially registered often have an advantage when it comes to securing loans, as they may be eligible for the reduced interest rates offered to Small and Medium-sized Enterprises (SMEs) in Kenya.

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