Are you considering going into business on your own without any employees? There are two business structures which is appropriate for any small outfit like yours: a single proprietorship (sole trader) or a registered company.
While you may consider setting up a single proprietorship, the Corporations Act of 2001 does allow you to set up a company with just one person to get and run everthing. If this is the way you want to go, then all you have to do is indicate your choice in the ASIC registration application as “a proprietary company with limited liability”.
You will be both the only shareholder as well as the sole director of your company. The company is legally regarded as being a sole shareholder/director proprietary venture. You may wonder why anyone would choose to register to be a sole proprietary company instead of as one proprietorship.
Well, there are some real benefits of being registered as a sole shareholder/director company. Read on for some potential reasons individuals pick a company with regards to a sole proprietorship:
* Legal personality of company.
Once a business or company is registered with the ASIC in addition to an ACN been recently is issued, the company becomes a lawful entity by using a personality which isn’t independent and separate looking at the shareholder. The aspect has important facts legally: A professional can enter into contracts in the own name and this may sue, and sued.
If a company is in debt, cash owed doesn’t automatically get to be the debt within the shareholder. As the result, a civil lawsuit for the gathering of an amount of cash against the corporation is not necessarily a a lawsuit against the shareholder.
This is that the liability of a shareholder is limited to the value of his shareholdings unless he previously signed a personal guarantee to opt for the one pursuing legal action. This built-in limitation is not available in single proprietorships or for sole traders.
So when you find yourself conducting business by yourself, and you wish to limit your enterprise liability, your sole shareholder proprietary company is for then you.
* Flexibility in ownership
If your grows in the foreseeable future and you would like to create incentives for your non-shareholder employees who have contributed into the success of your company, as well as good method to strengthen their involvement by transferring shares in a lot more claims to them.
This can also known as being a stock route. Because of the company’s structure, you can accommodate non share-holder employees into the corporate shareholdings without being required to terminate the legal status of the organization.
Another regarding the independent personality of the company is that it may continue to exist for the duration of that registration, notwithstanding changes regarding ownership of your company’s stocks. The death or retirement of a shareholder assaulted sale, transfer or assignment of the rights to be able to company’s shares will not mean the termination of a company’s existing.
You may one day decide to give over the reins of the company to a person else, regarding one of your experienced managers or employee-shareholders. Even dampness a change of directors, the company will stay alive as its registered auto.
It is worthwhile speaking using a legal adviser or accountant as to what is obtaining structure independently and your business. Also different countries may hold different legislation on this so check locally also.
It may be accomplished to register a company Online OPC Registration in India, nonetheless this can be a daunting prospect for you, there are appointed registered agents, to advise and manage your company number.