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Setting up a Company
by Trevor Marshall
Published on this site: November 20th, 2006 - See
more articles from this month
Even if you have a business plan and the financing all in order, you still
have to go through the motions of actually setting up the company, registering
it, and making it official. Many people might consider paying someone
for a service, but if youre a do-it-yourself kind of person and you want
to save a lot of money you can do it yourself. All it takes is an afternoon
and a little bit of patience.
- Why Incorporate?
The biggest advantage to setting up a company is incorporation.
Unlike an unincorporated business, corporated businesses are a separate
legal entity. The company will have its own name. You should incorporate
even if you are just running a one-person home business. You can also
sell your company later if the need arises if you incorporate.
- Limited Liability
By far, the biggest advantage to incorporating, however, is getting
what is known as limited liability. Let's say for the sake of argument
that someone sues your business. As a separate legal entity, the worst
that can happen is that you lose everything you invested into starting
up the company - collectors are not able to force you to sell your car,
home, etc. This isn't the case with an unincorporated business - your
liability is unlimited and your personal finances in addition to the
finances of your company are at stake.
- Step 1 - Select a Name
In order to start a business, first, you must apply for a registered
name. You will want to do research beforehand to see if any businesses
in your community currently are already using the name you are thinking
about naming your business. Try and choose a name that is unique, memorable,
and distinguishes your business as belonging to a particular industry.
For example, Acme Industries isn't as good as Acme Autobody. Likewise,
Acme Autobody can be made more origional and memorable - Speedy Autobody.
It might also help to add your town or city onto the end, for example,
Speedy Autobody Seattle. This is just an example of what separates the
sheep from the goats. You might also want to put your name in the company
name, for example, Johns Autobody Shop.
- What Type of Company Should You Choose
As was gone over earlier, chances are you will want your company
to be incorporated, meaning you are not personally liable for your business.
Other than that, you can choose to have your company privately or publicly
owned. Unless you are huge and intend to be listed in the stock market
you should stock to the private variety.
- Your Obligations
Once your business name has been approved, you will be provided with
a company registration number. It is then up to you to fill out another,
second form to register for an income tax number for your business.
You are also likely going to be required to have your place of business
inspected to make sure that it adheres to the requirements of a building
code - proper fire extinguishers should be a minimum requirement. Lastly,
you may want to put up a small sign for your business and you will also
want to display your licence in an inconspicous place on the premises.
Trevor Marshall - For more great company related articles and
resources check out http://workfromhomeinsider.info
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