Why Consider forming an LLC instead?
Starting your own business comes with a lot of challenges. It entails a lot of careful decision-making in the process too. New business owners must be able to decide on the form and structure of business they want to set-up. Limited Liability Company or often referred to as the LLC is just one of the options that have become popular in the recent years. The structure is appropriate for both small and alrge0-scale businesses. The structure of the firm significantly affects the taxes that the company pays for; thus, business owners have to be careful with the choice that they make.
Apart from the lengthy paperwork and additional fees that need to be done to make changes in the structure of the business, later on, business lawyers often advise their clients to think carefully before choosing the structure, to begin with. It’s not just about the additional work or payments that need to be paid; it is the complications that come with the changes that need to be implemented from the inside. So, if you are thinking of forming an LLC instead of a sole proprietorship type of business, here are some of the benefits that come with that decision:
• An LLC structure helps protect all of your personal assets. Owners or the "members" referred to in such business structure come with very limited liability regarding business debt.
• In such cases when the company is sued, the members of the firm are protected from all forms of litigation. Rather, the business itself to stand on its own.
• Trade name protection is a part of the benefits that come with the LLC structure. The government of Canada provides protection for those LLC owners to ensure that their trade name won’t be used by any other person or party for their business purposes or intentions.
• Limited Liability Company or LLC attached to your business name provides a particular type of credibility that encourages more respect for existing and potential clients and trade partners.
• An LLC opens doors for multiple owners of the business compared to the one-person ownership or liability of a sole proprietorship type of business.
• An LLC structure also helps you save from paying double taxes. The LLC passes the taxes through its members. Thus, it only has to pay taxes only once.
Deciding how to organise or put a structure in your business is a serious matter that you simply could not take lightly. If you are not sure if the LLC structure is for you, it is best to consult with a business lawyer to discuss other concerns you may have. Their expertise can help you decide.
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