Can a Company with Zero Revenue or Profit File CAC Annual Returns? The Legal Reality

For many tech startups, new SMEs, and family businesses in Nigeria, the journey between incorporation and generating the first Naira of revenue can take months—sometimes even years. During this pre-revenue phase, the business is legally in existence but financially dormant.

As the end of the calendar year approaches, founders often ask: "Do I still need to file CAC Annual Returns if my company made zero revenue or profit this year?"

Many assume that because there is no business activity, there is no need to notify the Corporate Affairs Commission (CAC).

However, this is an expensive misconception that leads to accumulated late filing penalties and a frozen corporate status. In this guide, we break down the legal reality under the Companies and Allied Matters Act (CAMA) and explain exactly how to file returns when your company has made zero revenue.

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The Short Answer: Yes, It is Strictly Mandatory

Under CAMA, the requirement to file annual returns is not dependent on business activity, revenue, or profitability.

Every registered limited liability company, business name, and NGO in Nigeria is legally obligated to file returns every calendar year. Even if your business:

• Has not opened a corporate bank account.
• Has not secured a single client.
• Has zero transactions.
• Has made massive losses instead of profits.

You must still file your returns. The CAC uses annual returns to verify that your company is still legally in existence and has not been abandoned.

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💡 What Happens If You Do Not File?

If you decide to wait until your company starts making money before filing, you will face severe consequences:

1. Accumulated Penalties: The CAC charges a late filing fee (currently ₦5,000 per year of default for limited companies) on top of the standard filing fee.
2. "Inactive" Status Tagging: The CAC registry will update your public search status to "INACTIVE."
3. Account Freezing: Once commercial banks audit your profile and see the inactive flag, they will restrict all transactions on your account (Post-No-Debit).
4. Delisting Risk: If a company defaults on annual returns for a consecutive period of 10 years, the CAC has the legal power to strike it off the national registry entirely.

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🛠️ How to File Returns with Zero Revenue (Dormant Filing)

The CAC provides a simplified, lower-cost filing structure for companies that are financially inactive (dormant). Here is how it is executed:

1. Statement of Affairs (Instead of Audited Financials)

Normally, large active corporations must compile and upload complex, audited financial statements signed by a chartered accountant.
However, for small businesses (turnover under ₦120 million) and dormant startups with zero revenue, you only need to submit a simplified Statement of Affairs or a simple balance sheet showing:

• Assets: The value of your equipment or initial share capital.
• Liabilities: Any initial registration costs or debts.
• Turnover: Declared clearly as ₦0.00.

2. Standard Government Fees

You pay the standard government filing fee (currently ₦5,000 for private companies) via Remita. This shows you are compliant without forcing you to spend money on expensive auditing services.

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Keep Your Entity Safe and Compliant

Don't let a pre-revenue phase turn into a compliance nightmare. Filing your annual returns on time protects your brand name, secures your bank account, and ensures your startup is "Investment Ready" when global VC partners or local investors perform their due diligence.

Our accredited corporate practitioners specialize in dormant filings and startup compliance. We can compile your Statement of Affairs, submit your filings, and maintain your "ACTIVE" registry status without any stress.

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