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I am so often asked about the legality and technicality of “trading as …………”

The legal position arises from the Consumer Protection Act. It states that any business trading under a name other than its own (e.g. ABC CC trading as XYZ) must register the trading name with CIPC (the old CIPRO).

CIPC then issued a statement to the effect that they do not have the capacity to register trading names (you’d think that the drafters of the Act would have checked with CIPC first) so it became impossible to comply with the Consumer Protection Act.

So anyone or any company or CC can call themselves “ABC (Pty) Ltd trading as XYZ” or Charles Mason trading as XYZ and that’s the way it’s usually done, the registered name very small and the trade name very prominent.

Note that the registered name must be given correctly and also note that the XYZ does not, and may not, have (Pty) Ltd after it.

What happens if you have traded as XYZ for 10 years and someone then registers the name XYZ (Pty) Ltd. Are you protected? No, not automatically, you would have to fight it in court and you may or may not win. So the safest thing to do is change the name of your company or CC from ABC to XYZ.

Note also, that before you “trade as ……” you would do well to check on the CIPC website whether the name that you wish to trade as is already the name of a registered company. If it is, then think of a different trading name.

62 comments

  1. If a CC was registered to secure a name but then not used /left dormant – is it ok if the registered member does work/trade (side hustle level) and declares income to sars in their personal capacity like a sole proprietor t/a?

    Also, do sars returns have to be made on a dormant cc? The first time a return came (when it was still mailed) the “dormant” box was checked and nil return submitted and sars never sent another return paper. Thought this meant returns weren’t required again unless/until trade in the CC began?

    1. Hi Shannon,
      I don’t understand the first part of your question. If a person earns income “trading as”, they declare the profits in their personal tax return and pay tax. That has nothing to do with whether they are members of a CC. They can use the name of the CC to trade as.
      All companies and CCs must submit 1st and 2nd provisional as well as annual tax returns each year wheether they areactive or dormant. If they don’t, SARS will start hitting them with a R250 per month Administrative Penalty for every outstanding annual return. Your CC may be getting hit already.
      It must also submit a Beneficial Ownership Return to CIPC followed by an annual return every year.

  2. Can you use your current registered company name if you deregister your company or must you use a different name as a sole prop?

    1. Hi Laylah,
      A sole prop can use any name as it is not registered anywhere.
      If you company is de-registered, make sure you get SARS to suspend it as a taxpayer, otherwise it will be hit with administrative penalties

  3. Charlotte Ndlovu

    Hi Derek,
    Thanks for the article and inputs.

    My company is dormant and was hit by SARS for administrative penalties which I’m not able to pay. I’m thinking of letting the
    company gets de-registered with time at CIPC. What are the consequences, do you think SARS can impose those penalties on me personally or on any other active company registered under my name.
    Thank you Charlotte

    1. SARS know that they can never collect those penalties unless the company starts trading, then they can raid its bank account.
      They have no recourse against you peronally or any other company that you register, but, my gosh, they have outsourced these collections to firms of attorneys and I get 100s of Final Demands and all style of other threatening emails. I just ignore them.
      They won’t even go away once your company is deregistered at CIPC, but you can sleep peacefully.

  4. Hi Derek,
    I have a compnay ABC Pty Ltd that went into AR Degristration. I called CIPC and they told me that unless I have fixed assets or a registered trademark under that compnay name, it cannot be re-instated. That I sort of understood.

    I also have another company XYZ Pty Ltd that is up to date and running. I saw that you need to reserve a company name to register is as a “Trading As”, so I tried to reserve a name the same as the company (ABC Pty Ltd) that was de-registered. The system told me that the name is not available. Is there any way to bypass this. so I can want to register a trading name for XYZ Pty Ltd trading as ABC Pty Ltd (or just ABC)

    Hope you understand the question

    1. Hi Andre,
      1) CIPC gave you the wrong information. If you can prove that the company was trading when it was finally de-registered (usually by means of bank statements), then it can be re-instated.
      2) Where did you see that you must register a trading name? Certainly, the Consumer Protection Act 2008 says you must, but then CIPC said they didn’t have the capacity, so that never happened.
      3) I always thought that you could reserve a company name that was previously used by a now de-registered company, but I can’t recall ever actually trying it. Maybe, however, the name was too close to another. Try searching for the name on CIPC and see what comes up.
      4) You can “trade as” any name you like, but cannot register that name at CIPC except as a Trade Mark, which requires the services of a trade marks attorney.
      5) You must not add (Pty) Ltd after a trading name, so, just ABC.

  5. Is it legal for the owners of 3 different registered companies, to trade under the same “trading as name”?

    example:
    abc pty ltd trading as “123properties”
    hij ltd trading as “123properties”
    stu ltd trading as “123properties”

    all have the same directors and shareholders, all performing the same function in the marketplace.

    1. Hi Don,
      There is currently no restriction on who uses what trading name. So, even I could use xyz trading as “123properties”.
      However, if there was a company registered as, for example, “123 properties”, you might get an attorney’s letter demanding that you cease to trade under so similar a name.

  6. Hi
    If you have a registered company name and you want to use a trading name.. How do you proof and protect your trading name since you not allowed to register at cipc

  7. Hi, what happens if I wanna start a company (name of the company) tranding and supplies (Pty) Ltd….

    Is it correct as mentioned above?

  8. Frans Coetsee

    Hi Derek, thanks for the very informative article. Well written for the lay person to understand.
    I have a registered company, which is fully compliant with regard to CIPC regulations. However, my preferred trading name is currently my website name, my instagram account and registered domain name. I started using this trading name before registering my company, and CIPC gave me another name for the business. You will most likely tell me that there is a reason I wasn’t allowed to register my preferred trading name, but company searches and domain registration process didn’t find any conflicting names and the trading name was approved. I’m going to continue using the publicly visible trading name, until someone complains.
    That is background context, now for my question:
    Where, and to whom, should I inform that I’m trading under this name, instead of my real (registered) company name. I do not use stationary, formal documents, etc. where one would normally see “…t/a XYZ”. My first thought would be that my bank, where I’m about to open a new account, should probably be told. Any other places, like on my website, for instance?
    If you require further info, please ask.
    Your views will be appreciated.
    Thank you.

    1. Hi Frans,
      I apologise for the delay. I seem not to be receiving notificaions of comments for some reason.
      Remember that yours is a company that is trading and you always have to disclose the company name (Pty) Ltd, even if only in small letters. You bank account will therefore be ABC(Pty) Ltd trading as XYZ.
      SARS also want the trading name as well as the company name.
      Of course, you can also change the company name at SARS. If you need help with that call my office on 011 805 0030 or email mini@harbourassociates.co.za
      That’s about it.

  9. Dear Derek,

    My business is registered with CIPC, “ABC (Pty) Ltd”.

    Another business in the exact same industry has opened and are using my company name. Surely I am protected seeing that the name is registered with CIPC?

    What steps must I take to stop the competition from using my business name?

    Kind Regards

  10. Hi,i have a registered business XYZ, and im trading under ABC,problem is the client(a big corporation )wants proof that ABC is trading under the registered XYZ..how can i proof that?

  11. Can you help? A sole proprietor required a bank detail change from his personal name to his ‘personal name trading as company name’ e.g. A Example t/a ABC. This ‘Trading as’ company ABC, however, is registered with CIPC. When I requested his company registration documents, he said he is a sole proprietor and only has a VAT document. Can this be done? He also has 2 VAT registration nos., one for the registered company and another in his personal name?

    1. Hi Coleen,
      I’m not sure what the question is.
      It appears that he has a registered company ABC (Pty) Ltd with a VAT registration and he also trades as a sole trader trading as ABC and with another VAT registration. There is nothing incompatible in this.
      You can search for the company on the CIPC website.

  12. Hi Derek,
    Say I have a registered company: fake company Pty Ltd, but am operating in two different industries eg Construction and IT.
    Can I create Divisions like FC Construction and FC Technologies?
    Can I trade with these divisions without writing fake company t/a FC Construction or Fake company t/a FC Technologies?
    I’ve noticed FNB is a division of FirstRand Group but does not put t/a, though they always state that its a division of FirstRand Group.

    1. Hi Katola,
      My apologies for the delay. I have been hospitalised.
      That’s an interesting point. Stating that FNB is a division of First Rand Group is the same as saying that FNB is First Rand Group t/a FNB.
      So, it’s your choice. Fake Company (Pty) Ltd t/a or Division of Fake Company (Pty) Ltd

  13. Good Day

    Hope you are well

    I had a company registered when I came out of school, I was young and foolish and did not know much and nothing was done with it after registration , I have not done any business nor any returns as the business is dormant, should I be worried ? I went to de-register but it wants me to get a tax clearance etc. , which I cant get I am really stressed about it and don’t know how to go about it.

    1. Hi Norman,
      My apologies for the late response. I have been hospitalised.
      Your best bet is to do nothing, either with SARS or CIPC. Eventually the company will be de-registered and if SARS imposes Administrative Penalties they can’t collect them from a company that has no money.

  14. Hi Derek,

    I have ABC technology group registered under my name, I now want to trade as XYZ boutique to maintain the same bank account.

    Does my “ new name” have to be ABC technology group t/a XYZ boutique or I can simply brand myself as XYZ boutique.

    And where and for what purpose do I use the full name, “ABC technology group t/a XYZ boutique”?

    1. Hi Zinhle,
      Assuming that you mean that ABC is a registered company then correctly “ABC Technology Group (Pty) Ltd t/a XYZ Boutique”. Note the (Pty) Ltd. You wouold use the name whenever you wanted people to know they were dealing with XYZ Boutique. Normally under those circumstances you would make XYZ Boutique much bigger than the rest of the name so that it stands out.
      If it is not a registered company but simply you, trading as ABC, then your other business would simply be XYZ Boutique.
      Either way they can use the same bank account.

  15. Bradford Wood - AVSEC PM

    Good evening Derek,

    I have registered with CIPRO a PTY – Ultimate Cycling Knysna. There is another company in Knysna that is AR Ultimate Cycling sports and Leisure t/an Ultimate Cycling.

    I have received a lawyers letter saying I have to stop using the name, which is registered VAT number and trading.

    Would I not have the legal Right to use the name as I have it registered with CIPC?

    1. Hi Bradford,
      Coincidentally, we live on Leisure island, Knysna. I would think that you do have that right, especially as the trading name is not protected unless registered as a trademark, but the problem is that to defend it is going to amount to paying probably a bucketful of legal fees, with no guarantee of success. By all means obtain legal advice, but be aware that the legal profession exists to fight each other at their clients’ expense.
      If it were me, I would change the name of my company and get on with my life.

  16. David Baker

    Hi

    Thanks for your blog article

    I am doing a pro-bono job “delegated” to me by my darling wife.

    Her hairdresser has a practical problem

    Names below are indicative
    – The CIPC and SARS business name is ABC
    – The trading name is XYZ

    All has worked fine for years

    However
    – Google Advertising now says that his CIPC docs dont match his advertising name
    – So there is no official link between the Trading As and his registered name

    Google are most probably using a robot to verify so arguing with a robot isn’t going to help

    So solutions I can think of
    – Change the Company Name from ABC to XYZ? This sounds like it could have unintended knock ons
    – Create another Company Name XYZ but continue to use ABC for accounting purposes. This means an extra reg fee etc.
    – Create an official linkage somehow?

    Thank you

    1. Hi David,

      I’m no longer a Google boffin and things have evidently changed since I qualified as one.

      Easiest is to change the company name at CIPC. It is not necessary to change it at SARS as the trasding name is, or should be, recorded there already.

      He will need to sort out the name of the bank account as well.

      I can’t think of any possible unforeseen consequences.

  17. Hi Derek, I have three companies registered separately. I want company two to own one and three in the mind that I’ll one day sell my personal shares. Does this make sense and is it possible n how it’s done.

  18. Good evening Derek
    i want to know if i can put my child as director,my fear is by the time she went in university will be no problem for busary.

    thank sir

  19. Mary Ann Naidoo

    Hi Derek,

    We have a takeaways and pub which was registered under one business. The registered business name is also the trading name.

    We are selling the takeaways and keeping the pub. We intend changing the trading name of the pub as it does not fit with the original concept. Can we let the new owner of the takeaways continue to trade under the old business name as it has equity and goodwill? Are we legally responsible for things the new owner does under the name we allowing him to trade under? Especially since the trade name is our registered named even though we will rebrand the pub under a different trade name?

    1. Hi Mary Ann

      You cannot be held liable for whatever the new owner does, regardless of names. However, why not rename your company to your new brand. That way you should avoid having his creditors knocking on your door. We can do it for you if you wish.

  20. Hi there,

    If you have a registered company CCC (PTY) Ltd. and you are trading under that name as a goods shop and then also have a BBB Consulting company that is currently “CCC (PTY) Ltd. trading as BBB Consulting” for services rendered – both would qualify (in combination) as a micro business which then gives you a tax benefit.

    Would it make sense to (to protect the BBB name) register it separately?
    Or will this then cause the micro business status to fall away as one of the compliance measures s “owner only owns 1 company” ?

    What would be the best ay forward?

    Thanks !

    1. Hi Cara,
      CCC may already have lost its status. It depends on the mix of goods shop and consulting (max 20%).
      You would lose the Micro Enterprise status for the reason that you yourself recognise.
      There are options –
      Have someone else hold the shares in BBB
      Have a trust hold the shares in BBB
      Then what tax benefit does CCC get from being a Micro Enterprise? In my view Turnover Tax is not a benefit. Rather go for Small Business Corporation – now that’s a real benefit.

      1. Thank you so much, that makes sense.

        If I then keep CCC the goods company seperate to ensure SME status can I also run the BBB consulting separately as a registered sole proprietor?

        Would this have any impact on CCC ?

        Thanks

        1. Hi Cara,
          I’m not sure what you mean by a registered sole proprietor? A Sole proprietor does not get registered, it’s simply you trading as ……
          That would not upset the SBC qualification of CCC. Note that I’m talking SBC not micro enterprise, although my answer is the same for both.

  21. How do VAT and loan accounts affect trading as entities. If company ABC is registered for VAT and has a loan account, is trading as XYZ also VAT registered and can income from XYZ be used to pay off the loan account in ABC?

    1. Hi Jill,
      From what I gather you only have one company but two trading names.
      That being the case, a company is a company is a company. It only makes one profit or one loss, albeit comprising the results of two different business activities. The fact that it trades under different names is irrelevant to the debt and its repayment. So, the answer is Yes.

  22. Christine

    Can i do name change from
    Abc (pty) ltd
    To xyz (pty) which has been trading name for 2 years without registering it as a new company to secure the business name

    1. Hi Christine,
      Yes, you first reserve the new name at CIPC, then register the change of name. The registration number stays the same.
      You should also change the name at SARS.
      I will email you a quotation.

  23. IF company ABC ( PTY) LTD is a registered business, Am I allowed to Use a Completely different name To trade as ?E.g XYZ driving school and DEF transportation.

  24. Haven’t submitted tax returns for My company as it wasn’t Operating for 3 years, are there any tax implications?

    1. Hi Ian,
      Yes. SARS is imposing a R200 administrative penalty every month for every annual tax return outstanding. But not all companies are being hit. Having said that I get about 300 emails every month from SARS advising that one of the companies we formed (and sold) has been hit. They are all dormant.

  25. Thanks so much. That’s the first straight answer to that question I’ve found.

    I have a registered business name. my question is, may I have 2 or 3 x “Trading As” names associated with my registered business?
    The idea is only to have to manage one bank account. What is the best practice in that case?

    TIA
    Andy

    1. Hi Andy,
      Your company can trade under as many names as it wants. The only issue that arises is determining which of the various businesses is profitable and which is a waste of time. However, in the early days, your gut will tell you. If any of the businesses becomes substantial it may then be a better idea to cut it away from the bunch, or at least open its own bank account.

  26. Hi , this is a good article

    I have a company named Vhaluvhu Logistics Pty Ltd
    Am I able to put trading as VLU HOLDINGS?

    1. Hi Gundo,

      Absolutely! Just as long as your trading name does not conflict with a Registered Trade Name or a Registered company name. If there is a conflict, that company’s attorneys will soon be on your tail.
      I checked at CIPC and you’re OK there, and there’s almost zero likelihood that someone has registered that as a trade name.

  27. Teboho Maphakisa

    Well written blog. Found all the answers I was looking for. Well done!

  28. Say I have company xyz pty Ltd. But I want to trade under ABC. Can I register a new company ABC pty Ltd and use it as trade name for xyz? Effectively I want to avoid having two bank accounts but need ABC name for marketing. It’s a different branch of my company

    1. Hi Anees,
      You have a choice.
      1) Forget about registering a new company and simply let “xyz” trade as “ABC. This, however, does not prevent someone forming a company “ABC (Pty) Ltd”
      2) Go the route that you suggested. This prevents someone forming a company “ABC (Pty) Ltd”. However ABC, despite not trading, will have to submit 3 Nil tax returns each year plus the two CIPC Annual returns.

      1. Do you mean that the company that you trade as is not registered at CIPC? Is this legal? Does that not cause confusion if my company is registered as ABC Logistics CC but trading as ABC Freight?

        1. Hi Ningi,
          Good question. In terms of the Consumer Protection Act (CPA) all trade name must be registered with CIPC, so it is NOT legal to fail to register a trade name at CIPC. However, it is IMPOSSIBLE to do so. CIPC issued a statement shortly after the CPA was promulgated 16 years ago, stating that they did not have the capacity to register trade names. Nothing has changed since. If it causes confusion, so be it.

  29. Vusumzi Rasmeni

    We already registered a business name. Can we be able to register a trading name under the existing name?

    1. Hi Vusumzi,
      You cannot register a trading name.
      But, any company can trade under a different trading name or names.
      It is then known as XYZ (Pty) Ltd trading as ABC
      Note that you do not put (Pty) Ltd after the trading name (ABC in the above case)

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