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What Business Structure is Best for your business needs

When deciding on a structure for your business, choose the one that best suits your business needs, keeping in mind that there are advantages and disadvantages for each structure.

It’s important to research each option carefully, as choosing your business structure is an important decision.

Your business structure can determine:

    • the licenses you require
    • how much tax you pay
    • whether you’re considered an employee, or the owner of the business
    • your potential personal liability
    • how much control you have over the business
    • ongoing costs

It is important to note that you can change your business structure throughout the life of your business. As your business grows and expands, you may decide to change your business structure, or to restructure your business.

Consult us when deciding on your business’s structure and type. It is important to determine your business structure and business type before you register a business or company as the steps may differ.

Business Setup Structure

Four Main Business Structure

There are basically four (types) of structures – Company, Trust, Partnership or Individual (Sole Trader).

Sole Trader

An individual operating as a sole person legally responsible for all aspects of the business. Like other structures, a sole trader can employ people to help you run your business.

Company

A legal entity separate from its shareholders. It means the company has the same rights as a natural person and can incur debt, sue and be sued. The company’s directors or shareholders can limit their personal liability and are genrally not liable for any debts incurred by the company.

Partnership

A partnership is a business structure that involves a number of people who carry on a business together. You may choose a partnership over a sole trader, if you’ll be jointly running the business with another person or a number of people (up to 20).

Trust

A trust is a legal relationship where a person (the trustee) holds assets (such as property) for the benefit of others, known as beneficiaries.

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