Business Start-ups & Incorporation of companies:
- Register your business name.
- Complete incorporation on your behalf or provide you with full incorporation kit.
- Determine what will happen to your current business losses and future profits.
- Determine what business assets and goodwill to transfer to the corporation.
- Choose a fiscal year end or calendar year end and when to incorporate.
- Develop a mix of salary, dividends and bonuses to be paid to yourself and others.
- Set up company books, records and government filings.
- Facilitate management decisions towards a successful business.
Categories
Pros
Cons
Proprietorship
- Easy to start
- Low start-up costs
- Low regulations
- Owner controls decision making
- All profits to owners
- Tax advantages
- Minimal working capital
- Business losses can be claimed on
- Unlimited liability
- Difficulty in raising capital
- Higher taxation rates with higher income
- Lack of continuity
- Business reliance on self
- May be difficult to sell
Partnership
- Easy to start up
- Low start-up costs
- Additional sources of capital
- Tax advantages
- Limited regulation
- Broader management base and complimentary talents
- Unlimited liability
- Difficulty in raising capital
- Divided authority
- Suitable partners may not be available
- Conflicts between partners
- Partners can legally bind each other
- Lack of continuity
- Profits are smaller per share
Corporation
- Limited liability
- Possible tax advantage
- Continuous existence
- Ownership is transferable
- Specialized management
- Easier to raise capital
- Capital gains exemptions
- Separate legal entity
- More expensive to set up
- Closely regulated
- Extensive record keeping
- Dividend taxation
- Shareholder liability
- Personal guarantees can undermine limited liabilities
