SA is off the greylist - Now SME compliance gets tougher

SMEs face stricter checks after SA’s greylist exit. Avoid penalties, blocked annual returns and deregistration with expert beneficial ownership and CIPC compliance support...

Issued by Company Partners

26 Nov 2025

SA is off the greylist - Now SME compliance gets tougher

The 2025 transparency crackdown has reshaped how small businesses must manage beneficial ownership and annual returns.

South Africa’s removal from the FATF Greylist on 24 October 2025 was widely welcomed by banks, investors, and government. It signalled that the country had finally met global standards for combating money-laundering and corporate opacity. For businesses in South Africa, this milestone did not mark the end of compliance pressure; it marked the beginning of a stricter and more heavily monitored era.

Before the FATF greylist delisting, the Companies and Intellectual Property Commission (CIPC) had already launched one of the largest enforcement waves in its history, not for fraud or criminal behaviour, but for failing compliance requirements.

This crackdown (and the new systems that power it) will continue long after the greylist exit. For SMEs, failure to understand this shift is quickly becoming a costly mistake.

The warning shot: More than 500,000 entities forced into deregistration

In early 2025, CIPC began issuing deregistration notices at unprecedented scale. More than 500,000 companies and close corporations were flagged for non-compliance. The overwhelming majority were not intentionally breaking the law. They simply:

missed annual returns,
failed to keep beneficial ownership (BO) information updated, or
misunderstood the link between BO and annual return submissions.

This purge was not accidental. It was a deliberate signal to FATF, and to South African businesses, that transparency is no longer negotiable.

Greylist Exit: A Success Built on Strict Enforcement

South Africa’s delisting did not relax the rules; it cemented them.
To remain off the greylist, the country must consistently enforce the anti-money-laundering reforms that FATF demanded.

That includes:

a fully functional, accurate beneficial ownership register,
automatic detection of non-compliance,
coordinated data-sharing between CIPC, SARS and the FIC, and
rapid removal of entities that fail to comply.

SARS confirmed it now has expanded access to BO information and works closely with CIPC to sustain ongoing enforcement. This means inconsistencies between tax records and company ownership information can trigger additional scrutiny.

Company Partners unpacks these post-greylist obligations further in its compliance warning brief.

Why beneficial ownership is now the heart of corporate compliance

South Africa introduced compulsory beneficial ownership reporting in 2023 to meet global transparency standards. The purpose is simple: To identify the actual human beings who own or control a company, not just those listed on paper.

Beneficial Owners include any natural person who directly or indirectly holds 5% or more of a company, even if their stake sits behind trusts, holding companies or layered structures.

According to business compliance specialist, Zola Mzoyi of Company Partners:

“Beneficial ownership shines a light behind the curtain. It tells regulators who truly benefits from, or controls, a company.”

This clarity is exactly what FATF demanded. Beneficial ownership is no longer a background requirement; it is now the primary gatekeeper for a company’s compliance status. For SMEs who are unsure what BO means in practical terms, Company Partners provides a clear, accessible guide here.

The critical system change: BO now blocks your annual returns

Before 2024, companies could file annual returns even if their ownership information was outdated. Not anymore.

CIPC introduced a strict technical control: If Beneficial ownership is incomplete, incorrect or outdated, the Annual Return cannot be filed.

This single change is responsible for most deregistration’s in 2025.

Mzoyi explains it plainly:

“BO is the gatekeeper of annual returns. Most failed filings happen because the BO register wasn’t updated.”

Once an annual return is blocked:

penalties accumulate,
the company becomes non-compliant,
CIPC issues deregistration notices, and
final deregistration soon follows.

The full implications of blocked annual returns are explained here.

Simple vs complex BO structures - What CIPC expects you to declare

Beneficial ownership reporting applies to every company - from one-person startups to multi-layered groups.

The key difference is how complex the ownership structure is.

Simple structures

John has a cleaning company: John is the only director and has 100% shares
→ John is the sole Beneficial Owner.
Lebo and Thabo have a stationary company: Both are Directors, but Lebo has 60% shares and Thabo 40% shares
→ both Lebo and Thabo are beneficial owners.

Complex structures

Janet is the sole director and shareholder of ABC Holdings, who owns 70% shares of Sun Tech (Pty) Ltd. Andy is the Director of Sun Tech and has 30% shares.
→ Andy is a Beneficial Owner, and
→ the natural person behind ABC Holdings (Janet) must be declared as Beneficial Owner.
A family trust owns 100% shares of a Company C, where Cindy is sole director.
→ the director and the trustees of the trust must be declared as Beneficial Owners.

CIPC expects the ownership chain to be traced back to human beings - no exceptions.

What non-compliance now means for SMEs

Today, the consequences of ignoring BO or annual returns are far more severe and far more public.

1. Deregistration

Once removed from the active register:

a company cannot trade legally,
cannot tender,
cannot apply for funding,
cannot enforce contracts, and
may face bank account restrictions.

2. Public BO non-compliance list

CIPC’s list is accessible to banks, funders, supply chain partners and anyone who knows where to find it. A red flag here can kill business opportunities instantly. You can .access the list here.

3. Director liability

Directors are legally responsible for ensuring BO is accurate.
Serious breaches can lead to fines up to R1m or 12 months imprisonment.

4. SARS flags

Ownership discrepancies may trigger audits, especially now that SARS has access to beneficial ownership data.

Why SMEs keep falling behind - and why they don’t have to

Most small business owners are not negligent. They’re overwhelmed.

Business owners are trying to juggle operations, payroll, tax, clients, staff and cash flow - and compliance becomes something they only look at once a problem surfaces.

CIPC’s system, however, offers no leeway. A single incorrect digit in an ID number or a failure to update BO after a share transfer can derail the entire Annual Return process.

This is why thousands of SMEs are now choosing professional support rather than wrestling with the portals themselves.

How Company Partners has simplified BO and annual return compliance

Company Partners has helped more than 50,000 South African businesses stay compliant since 2006. In response to stricter regulatory systems, the team created a streamlined, low-friction process that removes the complexity from BO and annual returns completely.

Instead of business owners dealing with portal errors, rejections and document confusion, Company Partners consolidates the entire workflow into a guided experience. Business owners simply provide their information and ID documents through a quick digital intake, after which the team generates a compliant BO register - whether the structure is simple or layered through trusts or holding entities. A compliance specialist then reviews the information manually to prevent the common errors Mzoyi warns about, and the submission is filed directly with CIPC and tracked until confirmation is issued.

Once BO is confirmed, Company Partners immediately proceeds with annual returns via the CIPC to restore or maintain good standing. New companies can be registered through Company Partners and SMEs needing SARS alignment can use the tax registration service.

Business owners who want a quick status check or assistance can reach the team directly via our website.

Final take: Staying compliant is no longer optional - It’s a direct business risk

South Africa’s greylist exit proved the country can meet international transparency standards. But maintaining that status requires constant enforcement - and that responsibility now rests heavily on CIPC’s automated systems.

For SME owners, the reality is simple: