Why Incorporating Your Business Will Make Your Life Easier As an Owner

Why Incorporating Your Business Will Make Your Life Easier As an Owner

There is no long stating that you cannot start and run a company that is not incorporated in some way of the other. However, there are certain benefits to forming a company and incorporating it formally. In the long term, it saves you a lot of headaches and time. Here are a few benefits to be considered for a European company formation.

Distributed liability The first important benefit of incorporating a company is that it established the business as a separate entity from yourself. This means that:  What you do as part of the business does not affect personal results any liability that shows up in future will be on the company and not on any person  The personal property and assets of members of the company are protected from bankruptcy This of course does not mean that if your company makes wrong decisions, you are not liable at all for it. However, incorporating does give you more freedom to make bold decisions.

Formalities of incorporating For all the benefits of incorporating your company, it does come with its share of workload. For instance:

 You need to know the laws that apply in your state regarding incorporated companies  The tax structure for a corporation is different from one for individuals, so you need to learn about that too  You need to maintain a lot of paperwork and submit them to the right authorities from time to time You can of course make all this easier on yourself by hiring an agency to manage all the legal and paper work for you. In fact, there exist a number of companies in Europe who specialize in forming companies for small businesses and individuals.

Which business structure?

If you are not aware of the types of incorporated companies, you might find the available options to be quite confusing. As an overview, here are the types of structures you can consider for company incorporation, Europe: • • • • •

Shelf company Limited Liability Company (LLC) Limited Liability Partnership (LLP) General Partnership Sole proprietorship

You might want to consult some experienced company formation companies to know more about the pros and cons of these various structures. The right choice of course depends on the type of your business and the size you expect it to grow to.

Also, the processes for incorporating a company differ from one region to another.

This is another reason to consider hiring an agency to do the paperwork for you.