Want to register a company in Zimbabwe but wondering which company type to choose? Below are the differences between PBC and PLC company you need to know before starting your booming business
We will not talk about the most noticeable difference of company registration cost of since this is justified below.
1. Difference between PLC and PLC company in size
PBC company is ideal for Small Medium Enterprises(SMEs).
According to Zimra, SMEs falls into a range, classified by having employees below 75 and an annual turnover not exceeding $1 000 000.
On the other hand, a PLC is suitable for large businesses like multinational companies wishing to expand into Zimbabwe’s market.
This does not limit you to register your business as a PLC even when your business is small or still starting.
2. Number of shareholder(s)
A PBC restricts ownership from 1 to 20 shareholders. You can operate your sole trader business without any fear of loosing control.
The only blow will be the extend to how much you can raise more capital when being compared to a PLC company which requires at least 2 to 50 shareholders.
Of these people, one of them must become a company secretary which is a must.
3. Cost of operation
In terms of operational costs, a PLC becomes more expensive to maintain in the long run than a PBC especially when we are not talking of whether you are making a profit or loss.
At the end of each accounting period each limited company is obliged to pay annual returns to the Registrar of Companies.
Its not a huge amount but often becomes a blow to startups which are yet to make a profit. So the concept of saving is going to stick around.
4. Document outcomes
Different types certificates are awarded when you register as a PBC or PLC company.
With PBC you get a Statement & Certificate of Incorporation which summarizes all your company information on one paper.
This document include all your company information and details of shareholders which comes under PLC as the CR6 and CR14 documents in PLC companies.
But in PLC you will get the CR6, CR14, Memorandum and Articles of Association as the documentation outcome.
To conclude, you might feel a PBC sounding inferior to PLC companies. Its not true since both of these companies are legally recognized under the Company Law of Zimbabwe.
So you can apply for government tenders, licenses or anything you wish as you would have done with a PLC company. Only business size, number of shareholders, cost of operation and the document outcome is what distinguish a PBC from a PLC.
My Advice: If you can afford both it will be amazing! I recommend you to take a PBC company if you want to start small and choose a PLC company if you plan for rapid expansion sooner. There are no hustles involved in converting a PBC into a PLC and vice versa. So go on to register what your can afford bearing your future business plans.
Having dealt with differences between PBC and PLC company. Are you thinking of registering your company to join us in the industry?
I am pleased to inform you that you can do here on this website with just two simple clicks. It’s very simple as A,B,C, so register now.
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