For many businesses, the annual return is the filing that gets pushed to next month, and then to the month after that. It rarely feels urgent. There is no customer waiting on it, no immediate cash consequence, and the business appears to run perfectly well without it. That comfortable assumption is exactly what the Corporate Affairs Commission (CAC) has been challenging, and its latest public notice is a good reason for every director to pause and reflect on the state of their company’s compliance.

Section 417 of the Companies and Allied Matters Act (CAMA) 2020 requires every registered company to file returns annually. It is one of the basic obligations that comes with the company’s incorporation, and it serves a simple purpose. Each year, the filing tells the CAC and the public that the company still exists, who the beneficial owners are, and that it is answerable to the law. A company that stops filing gradually stops conveying its intention to remain in business.

What Are Annual Returns?

Annual returns are mandatory filings that companies, business names, and other business entities must submit to the CAC at the close of each financial year. In case of a company, it must be filed within 42 days after the Annual General Meeting of the company. However, newly incorporated entities are not required to file their annual returns within the first 18 months of incorporation, while Business Names are expected to file their annual returns not later than the 30th day of June every year, except the calendar year in which the Business Name was registered.

These filings offer an updated overview of the entity’s operations, financial status, and ownership structure and are crucial in promoting transparency, accountability, and compliance with corporate governance principles.

Section 417 of the CAMA which mandates business entities to file their annual returns specifically provides as follows: “Every company shall, once at least in every year, make and deliver to the Commission an annual return in the form, and containing the matters specified in sections 418, 419 or 420 as may be applicable: Provided that a company need not make a return under this section either in the year of its incorporation or, if it is not required by section 237 to hold an annual general meeting during the following year, in that year”.

What the CAC Has Said

On 15 July 2026, the CAC issued a public notice announcing another round of striking off companies from the Register. The names of roughly 100,000 companies were published on its website, as companies liable to be removed. This would be the sixth batch since 2023, and the Commission has acted under Section 692(3) and (4) of CAMA 2020, which allows it to remove a company where there is reasonable cause to believe it is not carrying on business or is not in operation.

The notice was direct. Affected companies were given ninety (90) days to file all outstanding annual returns and, by extension, to bring their information on Persons with Significant Control, also known as beneficial ownership, up to date. Evidence of compliance was to be sent to the Commission, and companies that did not comply within the period were to be struck off without further notice. Counting from the date of the notice, that window closed on 13^th October 2026.

This is also not a one-off exercise as the Commission has reportedly struck off more than 400,000 companies in 2025 alone, and a fifth batch of 100,000 was published in July last year. This pattern demonstrates that enforcement has moved from occasional warning to regular practice.

The Beneficial Ownership Dimension

It would be a mistake to treat this as only an annual returns problem. The CAC's notice ties annual returns to Persons with Significant Control (PSC) information, and that is deliberate. Knowing who ultimately owns and controls a company is central to Nigeria's efforts to improve corporate transparency and to curb money laundering and other financial crimes prevalent in the country.

PSC has been defined by the Persons with Significant Control Regulation 2022 to mean any person (legal and natural) who satisfies any of the following conditions:

• directly or indirectly holding at least 5% of the shares or interest in a company or limited liability partnership;
• directly or indirectly holding at least 5% of the voting rights in a company or limited liability partnership;
• directly or indirectly holding the right to appoint or remove a majority of the directors or partners in a company or limited liability partnership;
• otherwise having the right to exercise or actually exercising significant influence or control over a company or limited liability partnership;
• or having the right to exercise, or actually exercising significant influence or control over the activities of a trust or firm whether or not it is a legal entity, but would itself satisfy any of the first four conditions if it were an individual.

A company that files its annual return but neglects its beneficial ownership records is only partly compliant, and it should expect the Commission to treat the gap seriously. In practical sense, CAC has made it rather impossible to submit an application to file annual returns without imputing the details of the PSC.

Why a Missed Filing Costs More Than It Appears

The most immediate consequence of non-compliance is the loss of the right to trade. The CAC has made it clear that a company struck off the Register may not continue doing business unless it is restored by an order of the Federal High Court. In practical terms, a struck-off company can find that it has no standing to sign contracts, operate accounts in the ordinary way, or deal with its own assets. Anyone who has traded with such a company afterwards may also face difficult questions about the validity of those dealings or contracts.

Section 425 of the CAMA 2020 states that “if a company required to comply with any of the provisions of sections 417-423 fails to do so, the company and every director or officer of the company are liable to a penalty as may be prescribed by the Commission”. Subsection 3 of Section 425 further provides that failure to file annual returns for a consecutive period of 10 years is a ground for striking the name of a company off the companies’ register. Below are some of the consequences triggered by non-filing of annual returns:

1. Revocation of Active Status:Non-filing of annual returns results in the loss of active status with the Corporate Affairs Commission (CAC). This inactive designation can hinder a company’s ability to bid for contracts, access credit facilities, or engage in formal business relationships, as its record may reflect non-compliance on the CAC’s public portal. In addition, the non-payment of annual returns can also affect the company when carrying out post-incorporation filings with the Corporate Affairs Commission. The application could be queried until the company files all outstanding annual returns.
2. Accumulation of Financial Sanctions: The Companies and Allied Matters Act (CAMA) mandates financial penalties for late submission of annual returns, ranging from N2,000 daily penalty calculated against the numbers of officers in the company. These fines accumulate over time, increasing the financial liability of the entity.
3. Risk of Strike-Off: Continuous failure to meet filing obligations may lead to the company being struck off the CAC register. Specifically, if a company does not file its annual returns for 10 consecutive years, it may be delisted, thereby losing its legal existence as a corporate entity (Section 425(3), CAMA 2020).
4. Legal and Criminal Exposure: Directors, trustees, or officers who neglect their statutory responsibilities under CAMA may face legal consequences, including criminal charges. This could lead to court-imposed sanctions such as fines or imprisonment, depending on the severity of the non-compliance.
5. Erosion of Credibility: Failure to comply with statutory requirements signals weak internal controls and poor corporate governance. This can damage the organization’s reputation, undermine stakeholder confidence, and limit future opportunities with investors, partners, or donors.

What Directors Should Do Now

The first step is to establish where the company stands. Search for its name on the CAC website and confirm whether it appears on the published list and what its current status is. If it does appear, or if the filing history is incomplete, the outstanding annual returns and beneficial ownership records should be regularised as quickly as possible, and the company should keep proof of every submission. Where the company has already been struck off, the route back is through the Federal High Court, and it is worth taking professional advice before starting that process.

Beyond the immediate fix, the more lasting answer is discipline. Annual returns belong in the company's compliance calendar alongside tax filings and audit deadlines, with a named person responsible for each. Records need to be kept in order throughout the year, so that the return is simply a matter of reporting what is already in place. Companies that do this seldom find themselves on a strike-off list.

Conclusion

The CAC's repeated strike-off exercises show that annual returns compliance is no longer something a company can safely postpone. Adherence to these regulations is not merely a bureaucratic formality, as we have seen, but a crucial requirement for maintaining legal standing, ensuring operational efficiency, safeguarding the reputation of the business and fostering trust within the business eco-system. To ensure compliance and avoid the consequences of non-filing, business entities should be proactive by establishing a robust internal tracking system to monitor filing deadlines, assigning clear responsibility for the preparation and submission of annual returns, leveraging digital platforms provided by the CAC for online filings and seeking professional guidance in order to navigate the complexities of the filing requirements. At Stransact Services Limited, we support companies with statutory filings, compliance reviews and the preparation of the financial records that underpin their returns. If you are unsure of your company's standing with the CAC, we would be glad to help you find out and put things right.