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.
When you are starting a business, it is imperative to know what type of legal business structure is most suitable to your enterprise. It’s basically a decision that you have to do research because the decision you make will affect your taxation levels, liabilities, ownership status, succession, disposal of your company if you have opted to sell it and several legal matters.
If you’re living in Ontario for example, you will notice in your research that Sole Proprietorship, Partnership and Company are the most common business structures being applied for.
Number 1. Sole proprietorship – this is a kind of business structure that has one person carrying all the company’s trading responsibilities.
Number 2. Partnership – for partnership, there are two or even more people who can share liabilities, profits, losses, risks and responsibilities.
Number 3. Company – this is much more of a regulated legal entity that is separate from shareholders and officers as well. Handful of the usual types of this structure 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. To ensure that you are making the right choice, it will be wise to ask yourself questions like what kind of business you wish to run, are you capable of handling responsibilities alone or would it be smart to share these obligations with a partner, what’s the kind of profit margin and income you deem acceptable, in what way profits will affect your taxes and personal income and so forth.
As soon as you’ve settled on what structure is best for you, you can now proceed to the next step of your business registration and that is to think of what name is appropriate for the nature of your business. It is good to choose name that sounds simple as it can be recalled easily, however, don’t forget that the name you are about to register is accepted legally. The government doesn’t allow 2 companies to use the same name and if what you are suggesting is taken already, better think of a new name.
As for entrepreneurs who are opening a business, it is sure to be overwhelming and stressful at the same time. Luckily, you don’t have to bear all these things if you hire corporate service agency.