Are you considering going into business on your own without any employees? There are two business structures that may be appropriate for a little 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 put in a company with only one person to own and run it all. 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 truly the only shareholder along with the sole director of business. The company is legally regarded being a sole shareholder/director proprietary company. You may wonder why anyone would decide either to register like a sole proprietary company as compared to as 1 particular proprietorship.
Well, plenty of real benefits of being registered as a sole shareholder/director company. Here are some potential reasons individuals select a company on a sole proprietorship:
* Legal personality of company.
Once a business is registered with the ASIC with an ACN may be is issued, the company becomes a lawful entity by using a personality can be independent and separate looking at the shareholder. The aspect has important facts legally: An agency can creep into contracts in its own name and this may sue, and be sued.
If a consultant is in debt, the owed doesn’t automatically become the debt of the shareholder. For a result, a civil lawsuit for the product range of a sum of money against the company is probably not a law suit against the shareholder.
This is because the liability of a shareholder has limitations to the value of his shareholdings unless he previously signed a personal guarantee just the one pursuing legal action. This built-in limitation is not available in single proprietorships or for sole sellers.
So if you find yourself conducting business by yourself, and you should limit organization liability, then sole shareholder proprietary clients are for families.
* Flexibility in ownership
If your business grows in the future and will need create incentives for your non-shareholder employees who have contributed to the success of one’s company, then this good way is to increase their involvement by transferring shares in the organization to him.
This one more 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 enterprise.
Another advantage of the independent personality of the company is it may continue to exist for the duration from the registration, notwithstanding changes in the ownership of your company’s stocks. The death or retirement of a shareholder or the sale, transfer or assignment of the rights to be able to company’s shares will not mean the termination with a company’s every day life.
You may one day decide handy over the reins of the company to a person else, such as one of the experienced managers or employee-shareholders. Even style a change of directors, the company will still exist as its registered individual.
It is worthwhile speaking with a legal adviser or accountant as as to what is extremely best structure on your own and firm. Also different countries may hold different legislation on this so check locally also.
It is possible to register a company Online One Person Company Registration in India, nonetheless this is often a daunting prospect for you, there are appointed registered agents, nobody can advise and manage your own company application.