Registering a business is the most important requirement you’ve got to secure before officially opening it. Applications have to be filled out and depending on the industry you want to tap in, licenses as well as permits have to be obtained.
Before you start investing your money on a business, it is crucial to know the legal business structure that’s suitable to your enterprise. Basically, this is a decision that you must not take for granted as the decision you make is going to affect your taxation levels, liabilities, ownership status, succession, disposal of your company if you have decided to sell it in the future and other legal matters.
As a quick example, some of the common business structures in Ontario are Sole Proprietorship, Partnership and Company that you’ll learn more in the next paragraphs.
Number 1. Sole proprietorship – as for this business structure, it means that there’s just one person responsible for the company.
Number 2. Partnership – in this regard, the liabilities, profits, losses, risks and responsibilities are divided into two or more persons.
Number 3. Company – this is more of a regulated legal entity that’s separated from its shareholders and officers. Few of the common types are proprietary and public companies.
Just before you get started with your business registration procedure, you have to consider all possible benefits and drawbacks of each structure and pick one that’s most advantageous to your chosen trade. By questioning yourself such as your capability of handling responsibilities, are you fine entering a partnership, what kind of business you like to run, what is the kind of profit margin and income is acceptable to you, in what way your profit affect your taxes as well as personal income and the likes can actually help you in guaranteeing that you are only making the right decision.
After you are done choosing the structure for the business, that is the only time where you can move on to the next step of business registration and it is about thinking of what name is appropriate for the industry your business is in. Picking a name that sounds simple is enough but don’t forget that your choice of name should be accepted legally in the country or state you are in. There should be no two companies have the same name and if your suggestion has been listed officially, then you’ve got to think of a different name or perhaps, change your original plan.
As for entrepreneurs who are opening a business, it is sure to be overwhelming and stressful at the same time. Fortunately, this can be done a lot easier by hiring corporate service agency to help.