Career Advice Detail Africa

Self Employment

Overview

The main export commodities in Ghana include cocoa beans and products, copra, cut flowers, cut diamonds, food ingredients, fruit, gold, manganese, timber and tea and coffee, while the main imports include fuel, intermediate goods, machinery, petroleum products, tobaccos, chemical products, consumer goods and crude oil.

The Ghana Business Code was introduced against the background of trade liberalization, globalization and challenges and opportunities associated with it. The Code represents three Ps in another sense; that it was developed through a unique Process of consultation and collaboration, a unique Product that meets both local and international requirements and unique Possibilities for sustainable business development.

Reference: Global Entrepreneurship

Types of jobs in this sector:

Sole trader - Also known as a sole proprietor, this is the option to choose if you run your own business and you take all of the profits you make after you pay tax on them. Although the term sole trader infers that you will be working alone it doesn′t mean that you can′t employ people but rather you are solely responsible for the business. Therefore you are responsible for any losses you make, all of the record keeping of your sales and spending and paying the bills for anything you buy for the business e.g. stock.

Partnership - When a business is owned by two or more people who are all responsible for funding the investment and start-up of the company. They are also liable for any losses the company may make. All business profits can be shared by the partners and each partner pays tax and National Insurance on their share of the profit. A partner doesn′t necessarily have to be a person it can be a limited company which counts as a ′legal person′. The company must choose a nominated partner to take responsibility for the book keeping and tax returns.

Limited company - Legally, this form of business separates the organisation and the person or people running it. Any profits made are owned by the company after it pays Corporation Tax, and the company can share its profits. The organisation has members who own a share of the company. These shares can be sold to friends and family members. A member of a limited company is only responsible for up to the value of their investment in the business. This means that if the business runs up a lot of debt, the members aren′t liable to pay the sum of the debt, just for their share of the investment.

As well as the above legal forms, businesses can be set up based on different trading practices. For example:

Franchises - A franchisee will buy a license from an existing business which often means that you can use the existing business′ brand, image and business model. The franchiser gets an initial (and then ongoing) fee for the franchise to use its product or service. The business is owned and operated by the franchisee but the franchiser has control over the marketing and way that the product or service is sold. Examples of current franchises include: McDonalds, Subway, some letting agents, automotive services and many more.

Cooperatives - Businesses owned and run by people with the same ethos and goals.

Social enterprises - Businesses which help people, communities or charity-based organisations. Choosing this option you could run as a Community Interest Company, which is a limited company that has a community interest statement and an asset lock which is a legal promise to use the company assets for its social objectives and only give so much money to its shareholders. Universities have started to place more emphasis on educating students about social enterprises and cooperatives.

Freelance or consultancies - You may wish to work as a freelancer or on a consultancy basis if you have skills, knowledge or a service which can be hired by companies. Commonly, this involves working from home or travelling to the different companies that hire you.

Reference: Prospects

What are the requirements for self-employment in Ghana?

Any person can enter into self-employment provided the person has the necessary resources to undertake the desired enterprise.

There must be a registration of the business as required by the Registrar Generals Department.

Other business operating permits will also have to be obtained at the appropriate District Assemblies/Local Authorities.

Are there any forms of support for self-employment?

Government offers both technical and financial support to self-employed persons through the following institutions:

What other forms of support are available?

Labour regulations provide that persons with disability who engage in an enterprise shall be given a special incentive that the Minister of Employment may determine.

There is business advisory support from government through the National Board for Small Scale Industries (NBSSI). There is other support from various business associations like the Ghana Employers’ Association, Association of Ghana Industries, Ghana Chamber of Commerce and Industry, Association of Small Scale Industries etc in the form of training, best practice, and advocacy for self-employed persons.

There is also donor assistance and support in the form of training, business advisory, finance, and other material support.

What form of protection is granted to self-employed persons?

Self-employed persons are encouraged to be members of the various business associations to receive support and protection of their ventures.

They also have the opportunity to utilise the services of the commercial courts and the Legal Aid system.

What are the obligations of the self-employed?

Self-employed persons are required to observe the following:

Observe safety and health rules and obligations relating to the operation of their business
Observe environmental rules and regulations
Operate with valid operating certificates, licenses and permits
File their tax returns and ensure to meet their tax and obligations, including fees, and all required payments.

Reference: Mywage.org/Ghana