Business Name vs Limited Company (LLC) in Nigeria: Which Should You Register?
7 min read · Updated 20 August 2026
Compare a business name and a limited liability company in Nigeria — liability, cost, tax, compliance and funding — to choose the right structure in 2026.
The short answer
Choose a business name if you're a solo trader or small partnership testing an idea with low risk. Choose a limited company if you want to protect personal assets, raise investment, bid for contracts or open doors with banks.
Liability and legal status
A limited company is a separate legal person. Its debts are its own, so shareholders' personal assets are protected. A business name has no separate legal identity — the proprietor is personally liable.
Cost and compliance
Business names are cheaper to register (from ₦25,000) and have lighter compliance. LLCs cost more (from ₦115,000) and require annual returns, statutory registers and, for larger companies, audited accounts.
Funding, contracts and credibility
Investors, banks and government agencies strongly prefer limited companies:
- Equity investors require shares to buy into
- Many tenders and contracts require an incorporated company
- Corporate bank accounts and loans are easier to obtain
- Perceived credibility with partners is higher
Tax treatment
Business name income is taxed as the owner's personal income under PIT. Companies pay Companies Income Tax, though small companies with turnover below the statutory threshold enjoy a 0% CIT rate.