The Kenyan Companies Act 2015 provides that a company is a company Limited by Guarantee if,

1. It does not have a share capital.
2. The liability of its members is limited to the amount the members guarantee or undertake to contribute its winding up or liquidation
3. The certificate of incorporation states that it is a company limited by guarantee.

A company limited by guarantee means that the liability of the company's members is limited to the amount the members guarantee or undertake to contribute towards meeting the obligations of the company in the event of its winding up or liquidation

A company limited by guarantee does not have any share capital or shareholders but is owned by members who act as guarantors and directors to manage the affairs of the company.
As there are no shareholders and since the general objectives of the company are Non profitable, generally there is no profit distributed to the members but any such profits or income are re-invested into the projects of the organization.

Uses of a company limited by guarantee.

Registration of a company limited by Guarantees in Kenya are commonly used for the many purposes including,

1. Charitable Foundations.
2. Non Governmental Organizations.
3. Foundations
4. Sports clubs.
5. Membership organizations
6. Common interest organizations

Biz Brokers Kenya assists you with the seamless application and processing of Companies Limited by Guarantee in kenya,

In Kenya, companies limited by Guarantee have become very popular as opposed to registration of NGO's. And provide alternative platforms for Non profit entities to carry on their objectives as a type of corporation used primarily for non-profit organizations that require legal personality.

It is important to note the before registration of a company limited by guarantee in Kenya, it is required that all the directors and members undergo a vetting process which has effect on the duration of registration.

Requirements for Registration of a company limited by guarantee in Kenya.

The following are the requirements for registration of a company limited by guarantee in Kenya,

1. The Proposed company names for search and reservation. - Three names provided for search in order of priority,.
2. Objectives of the company limited by guarantee.
3. Contact information of the company. IE
   • Telephone number of the company.
   • Email address of the company.
   • Postal Address of the company.
4. Proposed Physical address of the Company limited by Guarantee.  The physical Address must includes
   • Name of road
   • Name of Building or property.
   • Name of town or city
   • Name of county
5. Copy of National identity card for Kenyan citizens or National Passport for foreigners of the directors and Members.
6. Passport photo of the directors and Members.
7. Contact information of the Members and Directors which include
   • Telephone number of the company.
   • Email address of the company.
   • Postal Address of the company.
8. Residential addresses of the members and directors which include,
   • Name of road
   • Name of Estate or residence.
   • Name of town or city
   • Name of county

Procedure for registering a company limited by guarantee in Kenya.

1. Name search. Search and reservation of the proposed name. The name search and reservation processes done on the E-Citizen portal.
2. Filling out of Form CR 1 – Application form used for the registration of a company limited by guarantee.
3. Filling our of Form CR 3 - Model memorandum for a company limited by guarantee in Kenya
4. Filling out of Form CR 8 - Notice of residential address of the members of the company..
5. Application to dispense with the word “Limited"
6. Payment of Registration fees as follows,
   • The registration fee for all companies is Kshs.10,000/=.
   • Kshs.1,500/= with no share capital and 20 members or less
   • Kshs.6,000/= with no share capital and 20-100 members
   • Kshs.10,000/= with no share capital and 100+ members
   • For companies with over 100 Members:
     Kshs.1,000/= for every 50 members or less
     Kshs.11,000/= for unlimited members.

Vetting of companies Limited by guarantee in Kenya

After submission of documents for registration and the prescribed fees paid, the application documents and the director and member details are forwarded to the National Intelligence Services for vetting. The directors and members of the company may at times be summoned for an interview to provide more insights into the activities of the organization.
The documents are the sent back to the Registrar of Companies. If approved, the registrar shall proceed with the registration of the Company limited by guarantee.

KRA Tax Exemption of a company limited by guarantee

Upon registration of the Company limited by guarantee, A Personal Identification Number (PIN) Certificate from the Kenya Revenue Authority (KRA)vis issued, either auto generated or upon application. The company may apply for income tax exemptions allowed to charitable organizations under the Income Tax Act. If the application is accepted a Tax Exemption Certificate is issued by the KRA. This is issued for a renewable term of five years.

How long does it take to register a company limited by Guarantee in Kenya?

Due to the vetting and approval process, the application process of a Company limited Guarantee cant take an average four to eight months depending on the bulk of applications, the logistics, availability etc.

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Registering a non profit entity in kenya