Should I Form My Business As A Legal Entity?

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Initiating or starting a proprietorship, partnership, corporation or enterprise is a dream for a large number of people whilst maintaining and progressing towards success is reliant on the phases of planning and implementation and progress towards pre planned financial objectives.

 During the initial stages, deciding on the most suitable legal term for its creation could be identified as a hurdle in the case of non familiarity of the required registration process in the state or region. Researching and planning the phases in advance and obtaining  advise from professionals could assist in structuring of a suitable business plan whilst working towards a legally acceptable venture, availing benefits and perks offered through the system. In moments of uncertainty during these initial stages advice and assistance from a reputed and professional company incorporation Singapore could be of immense value to anyone concerned.

 Advantages of incorporating a business

Operating a corporation though associated with excessive documentation, record keeping and tax burdens parallel could be stressful for  new business owners and start-ups, But a few positive points to consider listed below could provide clarity in the decision making process.

 Unlimited Lifespan – Unlike a partnership or sole proprietorship, company formation as an incorporated entity ensures that the lifespan of a corporation is not dependant on the life of an individual or more. Its continuance is dependant indefinitely on its progress towards its objective, merger with another business entity or bankruptcy.

 Shares – Divesting one of ownership in a partnership or proprietorship could be a stressful and expensive process whilst the time consumed parallel could affect everything and everyone connected in a negative manner. With corporations, the shares held by each individual owner are considered to represent each individual owner’s rights and privileges. Each stock certificate contains an area indicated to shareholders that is used to endorse and sign over any shares to be sold.

 Raising investment capital – The ease in transferability of shares of stock directly to new investors is considered a key feature in attracting new investors. The feature is generally noticed during scenarios involving large values offered to the public. The services of exchanges and brokerage firms support the process during such timeline enabling increase in share values.

 Legality – In the case of situations similar to bankruptcy and loss, owners are protected from personal liability for organisational debt and obligations.

 Though general disadvantages are noticed in relation to cost, additional reliable information through reputed service provider not only could provide sound advice but assist significantly in establishing the ideal business. Therefore if unsure it is always best to consult a service provider for registration and formation of business.