How to Start a Sole Proprietorship Business in Kenya in 2024

A sole proprietorship business is an excellent way to become your own boss in Kenya. However, navigating the intricacies of Kenyan business regulations can be challenging. That’s why we are here to guide you on how to start a sole proprietorship business in Kenya. 

As the name suggests, a sole proprietorship is a business that belongs to one person. It can be ideal if you plan to employ yourself with a small working capital. It’s an easy business to administer and file tax returns for.

Keep reading to find out an easy procedure to start a sole proprietorship business in Kenya. 

How to Start a Sole Proprietorship Business in Kenya

The Registrar of Companies is responsible for registering all business types, including a sole proprietorship. You can find them at the Attorney General’s Chambers, Nairobi. 

However, the Business Registration Service Act 2015 simplified how Kenyans can start businesses across the country. It allows anybody outside Nairobi to locate a Business Registration Service in their county and start a business of their liking, including a sole proprietorship business.

Also Read: How To Start A Partnership Business In Kenya

Four Stages to Register a Sole Proprietorship Business in Kenya

The process of starting a sole proprietorship business in Kenya has four crucial stages. You should not miss any of these stages for the safety of your business. They include: 

Stage 1: Business Name Search and Registration

According to Kenyan business law, the registration of sole proprietorships, limited liability companies, and partnership businesses should start at the eCitizen website. Ensure you have an eCitizen account before searching for a suitable business name

The eCitizen Portal automates checking if a business name is still available. So, log in and access the Business Registration Service (BRS) section, as shown below:

eCitizen Business Registration Service

Once on the BRS section, click the “Make Application” button shown below:

How to start a sole proprietorship business in Kenya

Navigate to the Business Name Registration section as shown below and click “Apply.” Enter the name you choose for your business and its address details. We shall proceed from here in stage 3

Remember these points when searching for a business name: 

  • Choose a unique business name that demonstrates the purpose of your enterprise.
  • Formulate at least three business names before conducting the name search. If one or two are unavailable, you can settle on the third one. 
  • If your business name is available, reserve it to prevent another Kenyan from taking it. You should pay 100 shillings to make the name rightfully yours. Also, submit a name reservation letter with your money.
  • The eCitizen portal takes one to two days to reserve your business name

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Stage 2: Filling Out the BN2 Form to Register your Business Name

The BN2 Form is easier to fill if you collect the necessary data beforehand. It has the following sections of data:

  • Business Name Suggestions: Enter the business name you managed to reserve.
  • Nature of Business: Enter your business niche, including hair and beauty, outside catering, real estate, tours and travel, etc. If you plan to provide professional services, such as HR consultancy, attach a current practicing certificate from the relevant body.
  • Proposed Physical Address: Here you should add the location of your sole proprietorship business. Enter an address line with your plot or land reference number, street, town, county, and P.O. Box address. 
  • Full names: Add your name as it appears on your national Identify Card or Passport
  • Nationality: Write that you are a Kenyan. 
  • Age: Enter your current age in years and ensure your national ID can support that information. 
  • Gender: Choose between Male and Female.
  • Usual Place of Residence: Enter the name of your neighborhood, such as Utawala, Karen, Thika, etc. 
  • Other Business Occupations: You can leave this place blank or add the name of your other businesses. 

Note: For you to share the above business name registration data truthfully, make sure you have your ID card and KRA PIN copies.

Finally, upload the completed BN2 Form with any other required documents under the sole proprietorship tab in your eCitizen Portal. 

Stage 3: Register your Sole Proprietorship Business

Back to where we left off in stage 1. Once you’ve entered your business name and its address, the next step is to pay the processing fee. You’re expected to pay 850 Kenyan shillings to enter your sole proprietorship business into the government registry. 

After paying, wait for the process to end in about three to five business days

Stage 4: Download Your Sole Proprietorship Business Registration Certificate

After the approval of your business registration application (in 3 to 5 business days), the eCitizen system will automatically issue a Business Registration certificate. Download it on your computer and print it later on. 

Other Things to Apply For 

Visit the nearest Huduma Center and find out if you need a Business Permit to operate an enterprise in your County. 

Alternatively, learn about Kenyan business permits online. In Nairobi County, you can apply for a business permit at City Hall.

Registration with the Kenya Revenue Authority is necessary to simplify the tax collection process, including VAT payments. 

We hope you have learned how to start a sole proprietorship business in Kenya from reading this guide.