Most businesses begin as proprietorships or as partnerships, relatively simple structures that do not require separate corporate books and tax filings. The business owners are taxed personally on their business income and are personally responsible for losses. In the case of a partnership the partners may have to file tax information and may want a partnership agreement.
As a business grows many entrepreneurs consider incorporating to form a company. A company differs from a proprietorship in that
Incorporating requires planning including name selection, setting up a share structure, the issuance of shares and the choice of corporate articles. If there is more than one shareholder business owners may choose to draft a shareholder’s agreement to outline how the owners plan to run the business, share profit and establish exit strategies.
There are usually three main reasons businesses consider incorporating:
At DNC Integra Lawyers, we can help you start a new company, prepare your incorporation forms and shareholder agreements, and issue shares.