How to Upgrade Your CAC Business Name to a Limited Company

Upgrading your CAC Business Name (BN) to a Limited Liability Company (LLC) is one of the most important steps any growing entrepreneur in Nigeria will ever take. Many people begin their business journey with a simple business name because it’s cheaper, easier, and faster. But as the business expands, customers increase, and opportunities come in, the need to operate as a more structured entity becomes clear.

By converting your business name to a Limited Company, you unlock more legal protection, higher credibility, access to contracts, and better financial opportunities like loans, grants, and investor funding. Whether you're a freelancer, SME owner, startup founder, or someone running a home business, upgrading your CAC status positions you for long-term growth.

This detailed guide will explain everything you need to know, including requirements, costs, mistakes to avoid, processing time, benefits, and a complete step-by-step conversion process.

What Does It Mean to Upgrade a CAC Business Name?

Upgrading your CAC registration means transforming your current Business Name into a legally recognized Limited Liability Company under Nigerian law. In simpler terms, you are shifting from being a sole trader/enterprise to forming a new entity that stands on its own.

Example:

Chidera Fashion World → Chidera Fashion World Nigeria Limited

Prime Tech Solutions → Prime Tech Solutions Limited

A Limited company becomes a separate legal person, meaning it can:

1. Own assets
2. Sign contracts
3. Borrow money
4. Sue and be sued
5. Protect the owners from personal financial risk

This “legal separation” is one of the biggest reasons many entrepreneurs upgrade.

Why Most Nigerian Entrepreneurs Upgrade Their Business Name

Before diving into the conversion steps, it’s important to understand why this upgrade matters. Here are the biggest benefits:

1. Access to Bigger Corporate and Government Contracts

Most tenders and procurement offers require a Limited Liability Company with proper documentation. A business name alone may not qualify you.

2. Higher Customer & Investor Trust

Many customers check CAC status before doing business—especially online. Seeing “Limited” adds professionalism and reliability.

3. Personal Liability Protection

If something goes wrong in the business (debts, damages, legal issues), your personal assets are not automatically at risk.

4. Ability to Bring in Partners or Shareholders

A Limited company allows you to add directors or shareholders formally.

5. Better Access to Loans and Grants

Banks, fintech lenders, and grant programs prefer dealing with registered companies with clear ownership and structure.

6. Improved Business Continuity

A Limited company can continue to exist even if ownership changes, making it more stable.

7. Stronger Branding and Competitive Edge

Customers take you more seriously, especially in industries like tech, finance, consulting, logistics, and imports.

Requirements for Upgrading Your CAC Business Name to a Limited Company (2025)

Before you begin the upgrade process, it is important to understand that transitioning from a Business Name (BN) to a Limited Liability Company (LLC or Ltd) is essentially creating a new legal entity under the same brand you currently own. The Corporate Affairs Commission (CAC) requires specific documents, approvals, and information to ensure that your upgraded company meets all regulatory standards. Preparing these requirements ahead of time will make the entire process faster, smoother, and more cost-effective.

Below is a fully polished and comprehensive breakdown of all the requirements you need:

1. Availability and Reservation of the Name

To upgrade your business name, the first requirement is confirming that your current name is available for registration as a Limited Company. Some names exist as business names but are not available for use as a company because of similarity to existing companies or restricted words. You must run a name availability search on the CAC portal and reserve the approved name. Without a successful reservation, the upgrade cannot proceed.

2. Details of Business Name Ownership

CAC needs to confirm that you are the legitimate owner of the business name. This requires:

1. Your CAC Business Name Registration Number
2. A copy of your Business Name Registration Certificate
3. A copy of your CAC Status Report (not older than 3 months)
   These documents help CAC verify ownership, track your existing record, and ensure the upgrade is being requested by the rightful proprietor.

3. Personal Information of All Proposed Directors

Since a limited company must have at least one director for a private company and two for a limited company with multiple shareholders, CAC requires detailed information about them. This includes:

1. Full legal name
2. Date of birth
3. Nationality
4. Phone number and email address
5. Occupation
6. Passport photograph

These details form the basis of your company’s management structure and are mandatory for all individuals listed as directors.

4. Valid Means of Identification

CAC requires directors and shareholders to present valid and verifiable means of identification. Accepted IDs typically include:

1. National ID (NIN slip or card)
2. International Passport
3. Driver's License
4. Permanent Voter’s Card (PVC)

These IDs must be clear, valid, and consistent with the information provided during registration.

5. Tax Identification Number (TIN) Details (If Available)

While not mandatory at the point of upgrade, it is beneficial to provide TIN details for the business name or individuals involved. After the upgrade, the new limited company will require a fresh TIN, but supplying existing TIN data helps streamline future tax documentation.

6. Company’s Registered Office Address

Every limited company must have a registered business address where official documents, correspondence, and regulatory notices can be delivered. It can be a home office, commercial space, shared workspace, or virtual address, provided it is legitimate and accessible.

7. Information on Share Capital Structure

As part of the upgrade, your new limited company must define its share capital. CAC requires clear information on:

1. The amount of share capital (e.g., ₦1 million, ₦2 million, etc.)
2. Number of shares
3. Percentage each shareholder owns
4. Classes of shares (if applicable)

This structure determines ownership, voting rights, and profit distribution within the company.

8. Details of All Shareholders / Subscribers

CAC requires full details of all shareholders in the new company. In many cases, the business name owner becomes the primary shareholder, but you can add others. Required details include:

1. Full name
2. Residential address
3. Email and phone number
4. Passport photo
5. Means of Identification 

Their share allocation must also be clearly defined in the company documents.

9. Memorandum and Articles of Association (MEMART)

The MEMART is one of the most important documents for upgrading. It outlines:

1. The company’s objectives
2. Its operating structure
3. Rules governing directors and shareholders
4. Rights, responsibilities, and restrictions

A professional must usually draft or review the MEMART to ensure it complies with CAC standards and suits your business model.

10. Statement of Compliance

This is a legally required document signed by a legal practitioner certifying that the upgrade process meets all CAC requirements under the Companies and Allied Matters Act (CAMA 2020). Without this statement, the upgrade cannot be fully processed.

11. Payment of Applicable Fees

To complete the upgrade, CAC requires payment for:

1. Name reservation
2. Company registration
3. Stamp duty on share capital
4. Professional/legal fees (if using an agent or CAC-accredited consultant)

These fees vary based on share capital and service provider.

12. Updated Personal Data and Contact Information

If your details have changed since registering your business name—such as phone number, email, or address—you must provide updated information. CAC uses this to generate accurate company documents and maintain proper records.

13. Consent Letters (if required)

For some specific types of companies or where restricted words are used, CAC may request additional consent letters, such as:

Consent from relevant regulatory bodies

Consent of the business name owner to use the name (if more than one proprietor)

14. Digital Signature

Since the upgrade process is largely online, you will be required to upload a digital signature for directors and shareholders. This will be used on the incorporation forms and documents generated on the CAC portal.

Step-by-Step Guide: How to Upgrade Your CAC Business Name to a Limited Company (2025)

Upgrading a CAC Business Name to a Limited Liability Company follows a structured and clearly defined process on the Corporate Affairs Commission (CAC) online portal. Although the system has become more user-friendly in recent years, many business owners still struggle because they are unsure of the correct sequence of steps, the documents required, and how to avoid errors that slow down approval. This long-form guide explains every stage in detail so you can handle your upgrade confidently without confusion or unnecessary delays.

STEP 1: Conduct an Availability Search and Reserve Your New Company Name

The first step in upgrading your CAC registration is to check whether your preferred company name is available. Since a Limited Liability Company must operate under a unique name, you need to search for it on the CAC public search page. If the name is available, you can proceed to reserve it immediately. Name reservation protects the name for 60 days, giving you enough time to complete the upgrade process. If your original business name is still available, you can retain it and simply add “Limited” or “Nigeria Limited” to maintain your brand identity. This stage is crucial because your new Limited Company cannot be created until CAC officially approves your name.

STEP 2: Begin the Conversion Application on the CAC Portal

After your name reservation has been approved, you must log into your CAC account and initiate the conversion application. This process is specifically designed for Business Name owners who want to transition to a Limited Company. You will be required to enter your reserved company name, your existing Business Name details, the nature of your business activities, your registered address, your shareholders’ information, and the structure of your share capital. Every detail must match your official identity documents to avoid discrepancies that may lead to rejection. This step essentially lays the foundation of your new corporate identity.

STEP 3: Prepare and Upload All Required Documents

Once your application details have been filled in, the next major stage is document uploading. CAC requires several important documents to validate your new company. These typically include valid means of identification for all directors, recent passport photographs, the resolution or approval from the business owner authorizing the conversion, and the certificate or details of your existing Business Name registration. The CAC system will also generate some forms automatically, which you must download, sign, scan, and upload. It is important that all documents are clear, properly scanned, and legible. Poor-quality documents are one of the biggest causes of delays and rejection during the upgrade process.

STEP 4: Pay the Required CAC Conversion and Registration Fees

After uploading your documents, the system will automatically generate the fees required to complete your conversion. These fees vary depending on your company’s declared share capital, level of processing, and the type of structure you are registering. Payments generally include the name reservation fee, conversion fee, company registration fee, and sometimes stamp duty depending on your share capital. CAC allows payment through the portal using authorized online channels. Once payment is completed, a receipt or transaction confirmation will be issued. This stage is critical because CAC will not begin processing your application until payment has been successfully made and verified.

STEP 5: Submit Your Application for CAC Review and Approval

When your documents and payments are complete, the next step is to formally submit your application for review. CAC officers will examine your information to ensure it complies with all requirements for upgrading to a Limited Company. They will review your documents, verify your director information, confirm your share capital structure, and validate your reserved company name. If anything is missing, incorrect, or unclear, they may send a query asking you to correct and resubmit the affected section. However, if everything is in order, the approval process continues smoothly. Patience is important at this stage because the review duration can vary depending on workload and system activity.

STEP 6: Receive Your Certificate of Incorporation and Company Documents

Once CAC approves your application, your upgrade is complete, and you will officially receive your company documents. These include the Certificate of Incorporation, which confirms the legal existence of your new Limited Company; the Status Report, which contains details about your directors, shareholders, and share capital; and the Memorandum and Articles of Association (MEMART), which outlines the internal governance structure of the company. All documents are delivered digitally via your CAC dashboard, allowing you to download and print them whenever needed. After receiving these documents, your Business Name becomes inactive, and your new Limited Company becomes the official legal entity through which your business will operate.
 

What Happens to Your Old Business Name After Conversion?

When you upgrade your Business Name (BN) to a Limited Liability Company (Ltd), many entrepreneurs assume the old business name simply disappears. However, the Corporate Affairs Commission (CAC) follows a structured process to ensure the transition is legally smooth, traceable, and fully compliant with CAMA 2020. Understanding what happens to your old Business Name after conversion helps you avoid mistakes, maintain regulatory compliance, and communicate clearly with customers, banks, and partners.

1. The Old Business Name Becomes Legally “Ceased”

Once the upgrade is approved, your old Business Name is marked as “ceased” or “converted” on the CAC database. This means the business name registration is no longer active as a sole proprietorship or partnership. However, the record is not deleted. It remains in the CAC system for historical and audit purposes.

The business name cannot operate independently anymore because it has now transformed into a new legal entity — your Limited Company.

2. The Name Is Reserved Exclusively for Your New Limited Company

After the upgrade, CAC automatically ties the old business name to your newly registered Limited Company. This prevents any other individual or business from registering or using the name. Essentially, your old business name becomes a protected brand identity under the new company.

This linkage is permanent and helps protect brand continuity.

3. All Rights, Assets, and Liabilities Transfer to the New Company

One of the most important outcomes of the conversion is that the limited company becomes the successor entity. This means:

1. All customer relationships
2. All business assets (digital, physical, operational)
3. All debts and liabilities
4. All contracts and agreements
5. All ongoing transactionsnow automatically transfer to the limited company. The old business name no longer holds these responsibilities or ownership rights.

This legal continuity protects your business from disruptions and ensures that suppliers, banks, and partners can continue working with you seamlessly.

4. Your Old Business Documents Become Obsolete

Documents like:

• Business Name certificate
• BN status report
• Proprietor details

are no longer valid for official use. They cannot be used for bank KYC updates, loan applications, tax filings, or contract execution.

Going forward, only your Limited Company’s documents are acceptable, including:

• Certificate of Incorporation
• Form CAC 1.1
• MEMART
• Status Report of the new company

This also means you must update your business records everywhere you operate.

5. Your Old BN Bank Account Must Be Migrated or Closed

Banks treat your Business Name and Limited Company as two different legal structures. Therefore:

• Your BN account cannot continue to operate once the conversion is complete
• You must open a new Corporate Account for the limited company
• Funds in the BN account should be transferred to the new account
• The BN account is eventually closed after migration

Most banks require your new incorporation documents to activate the new corporate account.

6. You Must Stop Issuing Receipts, Invoices, or Legal Documents With the Old Name

For legal purposes, once the BN is converted, you must no longer transact business using it. Every official document must reflect the new company name, for example:

❌ SabiBusiness Ventures
✔️ SabiBusiness Ventures Limited

Continuing to use the old BN in contracts or invoices may render those documents legally invalid.

7. The Business Name Is Still Visible on CAC Records

Even though the BN ceases to exist as an active business, it remains on CAC’s public database with a status such as:

• “Converted to Limited Company”
• “Ceased – Upgraded”
• “Incorporated as Ltd.”

This helps auditors, banks, and regulatory bodies track your business history for transparency.

8. Tax Records Must Be Updated Under the New Entity

Your old BN TIN is no longer valid for your upgraded company. The new Limited Company requires:

• A fresh TIN
• Updated tax files at FIRS
• Possibly an updated VAT registration

This ensures that all tax obligations reflect the limited company’s new legal identity.

9. Copyrights, Intellectual Property, and Trademarks Must Reflect the New Company

If your business name is used in:

• Branding
• Trademarks
• Product labels
• Registered content
• Licensing agreements

you may need to update those assets to match the new legal entity. This guarantees full ownership protection under the Ltd structure.

10. Public Communication Becomes Necessary

For transparency, trust, and customer confidence, it is advisable to announce the conversion publicly, such as via:

• Website updates
• Social media posts
• Email newsletters
• Supplier notices
• Contract amendments

This ensures stakeholders understand that you have evolved into a more formal and legally structured company.
 

Common Mistakes People Make When Upgrading Their CAC Registration

Upgrading a CAC Business Name to a Limited Company is an exciting step for any entrepreneur, but it can also be a source of delays, rejections, or unnecessary complications if proper care isn’t taken. Many business owners assume the process is simple because it is now online, but small errors or oversights can lead to weeks of waiting or additional costs. Understanding the common mistakes made during this process will help you avoid pitfalls, streamline your upgrade, and ensure a smooth transition from a business name to a fully recognized Limited Liability Company.

1. Choosing a Name That’s Too Similar to Existing Companies

One of the most common mistakes is selecting a company name that is too close to an already registered Limited Company or trademarked brand. CAC has strict rules to prevent confusion between companies. Names that appear similar may be rejected outright, forcing you to restart the name reservation process. Many business owners fail to consider this and only realize the issue after submitting the application. To avoid this, always conduct a thorough name availability search on the CAC portal and prepare at least two alternative names in case your preferred choice is rejected.

2. Submitting Blurry, Incomplete, or Incorrect Documents

Document quality is critical. Some applicants submit scanned copies that are unclear, cropped improperly, or missing key pages. CAC requires clean, legible scans of IDs, passport photos, existing business name certificates, resolutions, and forms. Mistakes such as mismatched ID numbers, missing signatures, or unreadable text are frequent causes of rejection. Double-check every document before uploading, and ensure all file formats comply with CAC’s requirements (typically PDF or JPEG).

3. Using Inaccurate Director or Shareholder Information

The details of directors and shareholders must be accurate and match their official identification documents. Mistakes such as misspelled names, wrong dates of birth, or incorrect addresses can cause CAC to flag your application. In some cases, an entire application is delayed until the errors are corrected. Ensuring all personal and contact information is precise and consistent across all forms and uploaded documents is essential for a smooth approval process.

4. Improper Share Capital Allocation

Many entrepreneurs underestimate the importance of correctly defining their company’s share capital. CAC requires a detailed breakdown of the total share capital, number of shares, and allocation to each shareholder. Failing to provide accurate share capital information can result in rejection or a request for resubmission. It is also important to comply with any minimum share capital requirements for your type of company. Consulting a financial or legal advisor can help prevent these errors.

5. Forgetting to Update Bank or Tax Information

Once the business is upgraded to a Limited Company, banks and tax authorities will require documentation that reflects the new legal status. Some business owners forget to migrate their bank accounts or update their TIN, leading to complications with payment processing, loan applications, or tax filings. Preparing ahead and notifying your bank and relevant tax offices of the change ensures a seamless transition.

6. Continuing to Use the Old Business Name

Some business owners continue to issue invoices, receipts, or contracts under the old Business Name after upgrading. Legally, the old business name ceases to exist as a sole proprietorship, so continuing to use it can invalidate documents and confuse customers. All official documents, branding materials, and communications must immediately reflect the new Limited Company name.

7. Not Preparing MEMART Properly

The Memorandum and Articles of Association (MEMART) is a legally required document that defines how your company will operate, including rules for directors, shareholders, and governance. Errors in drafting MEMART or using outdated templates can cause delays, compliance issues, or rejection by CAC. Many first-time business owners underestimate its importance and do not seek professional review. Ensuring MEMART is properly prepared according to CAMA 2020 is essential.

8. Attempting to Skip Steps or Rely on Assumptions

Some applicants assume that the process is identical to registering a new business name and attempt to skip steps, such as name reservation or uploading certain documents. CAC will reject incomplete applications, and skipping steps often results in wasted time, additional payments, and repeated submissions. Following the full, step-by-step procedure is essential to avoid unnecessary delays.

9. Ignoring Regulatory Requirements and Special Permissions

For certain industries, additional permits, licenses, or regulatory approvals are required even during conversion (for example, finance, food, logistics, or healthcare businesses). Entrepreneurs who ignore these requirements risk having their application stalled or rejected. Always verify whether your line of business requires extra documentation or consent before applying.

10. Underestimating Processing Time

Finally, many business owners underestimate how long the process can take. While CAC now offers online applications, approval still takes time, usually 3–10 working days. Expecting instant approval may lead to unnecessary follow-ups or frustration. Planning your business operations around realistic timelines is essential.

What to Do After Upgrading Your CAC Registration

Your work doesn’t end after getting your company certificate. Here are important tasks to complete next:

1. Open or Update Your Corporate Bank Account

Once your business name has officially been upgraded to a Limited Company, the first step is to open a new corporate bank account or update your existing one. Banks will require your new Certificate of Incorporation, Status Report, MEMART, valid means of identification, and a completed account-opening form. Updating your bank records ensures the company can receive payments professionally, build financial credibility, and maintain proper accounting. This step also separates your personal finances from the company’s transactions, which is essential for tax compliance, loan applications, and business transparency.

2. Update Your Tax Identification Number (TIN)

A Limited Liability Company must have a Company TIN, not the personal TIN you may have used previously. After conversion, visit the nearest FIRS office or use an accredited agent to apply for your company’s TIN. This new TIN will be tied to your corporate structure and used for tax filings, invoicing, government transactions, and contract bidding. Updating your TIN early prevents tax complications and ensures your business operates legally under its new corporate identity.

3. Update Your Business Listings and Online Profiles

Every platform where your business appears—such as Sabibusiness, Google My Business, Instagram, Facebook, and your website—should reflect your new company name. Consistency across all channels boosts your brand credibility, improves SEO ranking, and prevents customer confusion. Updated listings also help potential clients verify your CAC status easily, which builds trust and strengthens your professional reputation online.

4. Review and Update Contracts, Agreements, and MOUs

Any ongoing contracts, service agreements, partnership deals, employee letters, vendor agreements, and MOUs should be reviewed and updated to feature your new company name. Legally, a Limited Company is a different entity from a Business Name, so existing documents must reflect the upgraded structure. Updating your contracts ensures that all future liabilities, obligations, and revenues are tied to the company—protecting you personally and establishing clarity in business dealings.

5. Inform Customers, Vendors, and Business Partners

After upgrading your CAC, it’s important to notify your customers, suppliers, collaborators, and strategic partners. This simple step reinforces professionalism and assures your clients that the business is expanding. It also prevents confusion when they see the new company name on receipts, invoices, or bank details. A short announcement across your communication channels—email, WhatsApp, social media, or website—keeps everyone on the same page and strengthens brand trust.

6. Update Your Business Website and Branding Materials

Your website, logo, business cards, letterheads, invoices, packaging, and marketing materials should all reflect your new name and identity. Consistent branding signals growth and professionalism, while outdated materials may make your business look unorganized. Updating your digital and offline branding also improves customer experience, enhances credibility, and aligns your brand image with your new corporate status.

7. Review Your Accounting, Record-Keeping, and Compliance Structure

A Limited Company is required to maintain proper accounting books and comply with corporate regulations. After upgrading, ensure you begin recording transactions accurately, separating personal expenses from company expenses, and preparing for annual filings. This is the perfect time to start using accounting tools, hire an accountant, or implement a simple bookkeeping system. Strong financial records will help you secure loans, grants, and investor confidence.

8. Apply for Necessary Permits or Industry Licenses (If Applicable)

Some industries—such as finance, logistics, health, e-commerce, or food services—may require additional permits once you operate as a Limited Company. Upgrading is a great opportunity to review which licenses apply to your company and complete the necessary registrations. This keeps your business compliant and opens the door to partnerships and larger corporate clients who require proof of regulatory approval.

Frequently Asked Questions (FAQs)

1. What does upgrading a CAC Business Name mean?

It means converting your sole proprietorship or partnership into a Limited Liability Company, giving your business legal recognition, separate assets, and personal liability protection.

2. Who can upgrade a CAC Business Name?

Any owner of a registered CAC Business Name in Nigeria can upgrade, whether a single proprietor or a partnership.

3. How much does it cost?

Typically ₦30,000–₦70,000, depending on share capital and fees. Additional costs may apply if you use an agent or legal practitioner.

4. How long does it take?

The process usually takes 3–10 working days, provided all documents are correct and fees are paid.

5. Can I keep my old business name?

No. The old Business Name ceases to exist and all transactions must reflect the new Limited Company name.

6. Do I need a lawyer or agent?

Not mandatory. The process can be done online, but agents can help avoid mistakes and speed up approval.

7. What documents are required?

You need your Business Name certificate, IDs of directors, name reservation, MEMART, shareholder info, and approval resolution.

8. What happens to my bank account?

Your old Business Name account must be closed or migrated. A new corporate account under the Limited Company name is required.

9. Can I add new shareholders or directors?

Yes. The upgrade allows you to add directors and shareholders formally.

10. Is upgrading mandatory?

No, but it’s recommended for growth, credibility, legal protection, and access to contracts or funding.

Final Note

Upgrading your CAC Business Name to a Limited Company is a major milestone on your entrepreneurial journey. It opens the door to partnerships, contracts, funding, legal protection, and long-term stability. The process is easier than many people think—as long as you follow the steps carefully and use correct documents.

Whether you’re expanding your business, seeking credibility, or preparing for investment, upgrading your CAC from business name yo a limited liability company sets you up for the next level of success.