Are you considering going into business on your own without any two people? There are two business structures which really can be appropriate for a good 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 setup a company with only one person to own and run everything. 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 become both the sole shareholder and also the sole director of organization. The company is legally regarded being a sole shareholder/director proprietary small business. You may wonder why anyone would would prefer to register as a sole proprietary company regarding as one proprietorship.
Well, there are real advantages to being registered as a sole shareholder/director company. Every potential reasons individuals choose a company of a sole proprietorship:
* Legal personality of company.
Once a business or company is registered with the ASIC with an ACN recently been is issued, the company becomes an authorized entity having a personality is actually independent and separate from the shareholder. The aspect has important facts legally: A business can received contracts in its own name and will also sue, and be sued.
If an enterprise is in debt, the amount owed doesn’t automatically become the debt of the shareholder. As being a result, a civil lawsuit for the gathering of an amount of cash against the corporation is never a legal action against the shareholder.
This is simply because the liability of a shareholder is fixed to the price of his shareholdings unless he previously signed a personal guarantee just the one pursuing law suit. This built-in limitation is not available in single proprietorships or for sole options traders.
So when you find yourself conducting business by yourself, and you desire to limit your business liability, after that your sole shareholder proprietary company is for you.
* Flexibility in ownership
If your business grows in the foreseeable future and you wish to create incentives for your non-shareholder employees who have contributed into the success of one’s company, then came good technique to better their involvement by transferring shares in a lot more claims to all of them.
This likewise known as being a stock option. Because of the company’s structure, you can accommodate non share-holder employees into enterprise shareholdings becoming required to terminate the legal status of they.
Another benefit of the independent personality of the company is that it may continue to exist for the duration of registration, notwithstanding changes in the ownership of your company’s shares. The death or retirement to a shareholder possibly the sale, transfer or assignment of the rights to a company’s shares will not mean the termination about a company’s existing.
You may one day decide to hand over the reins of the company to someone else, since one of one’s experienced managers or employee-shareholders. Even whenever there is a change of directors, the company will stay alive as its registered auto.
It is worthwhile speaking along with a legal adviser or accountant as to what is incredibly best structure for yourself and company. Also different countries could 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 company number.