What are the benefits of registering a business?

Jeffrey L EvansJeffrey L Evans subscriber Posts: 13 Bronze Level Member
Hello all,
I am thinking of registering my business. I run a small consulting business in the real estate industry. I help my clients to evaluate their property and, help them with mortgages, planning of additional construction, renovation and reworks etc. Since I am the sole owner of the business, I was using my own name until now. Here in Ontario, we do not have to go for business registration if the business is using operator's name. But, I heard, registering a business has a lot of benefits. But, it involves cost and a lot of paperwork. And, we have to make sure that the name we have chosen for our business does not infringe upon other business or their product. So, I am just wondering should I continue with registering my business or not. I would like to know what you guys have to say about this?
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Comments

  • Tuah BaoTuah Bao subscriber Posts: 119 Silver Level Member
    Hi Jeffrey,

    There are many benefits of registering your business. Let me just highlight 2 key points:
    1) Limit your personal liability
    Your business will become a separate legal entity. Your creditors cannot go after your personal assets.

    2) Minimise your tax
    You may enjoy certain tax incentives and some tax deduction.
    Tuah Bao
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  • jordanmcclurejordanmcclure subscriber Posts: 15 Bronze Level Member
    The purpose behind this is to allow customers to be able to access information about who is running the business they are dealing with. This is the name that a person or organisation conducts a business and trades under. You are required to register your business name if you carry on a business.

    Reasons Why You Should Register Your Business:
    1. It gives you a unique identity
    2. It protects you from personal liability
    3. It makes you look serious and attracts more customers
    4. It’s easier to get bank credit and investment from investors

    Types of business registration available :
    1. 
     Sole Proprietorship-  A Sole Proprietorship (also known as a sole trader or simply a proprietorship) is a type of business entity that is usually owned and operated by one person. This type of entity is best for small traders, shop owners and artisans (plumbers, carpenters etc) who typically work alone in their business.
    2. Partnerships - a partnership is a business entity owned and managed by two or more partners. Ordinarily, partnerships do not enjoy limited liability. However, in many countries, there are Limited Liability Partnership arrangements which limit the liability of the owners to their investment in the partnership.
    3.  Private Limited Liability Company - This is the most popular and common type of business entity that exists. As the name suggests, the owners of this type of business entity enjoy limited liability. As a result, the names of this type of entity usually ends with ‘Ltd’, ‘Limited’ or ‘Inc’ depending on the country and legal system.
    4.  Public Limited Liability Company (PLC) - Commonly referred to as ‘PLC’ in some countries, this type of entity is almost an exact lookalike of a Private Limited Liability Company. The major difference is that PLCs are publicly owned and their shares are traded on stock exchanges where anyone can buy and sell its shares. Only PLCs can sell their shares on a stock exchange. PLCs are perfect for very large companies. Typically, most companies start as private limited liability companies before they become public limited liability companies.

    If you are want to incorporate your business you may contact Paycron. Email - [email protected]
  • Alex LoAlex Lo subscriber Posts: 1 Member
    edited January 2019

    I believe there are two options:

    Sole Proprietorship: It would be useful for small business, but unlimited liability means that you have to pay full debt for the company. You and the company are the same entity.

    Limited Company: It would be more organized as it would be treated the owner and company as separate entity, meaning if you sign contract with your client, it would be limited liability.

    There are different options nowadays. Can think about some offshore jurisdiction like Hong Kong (around 8%), Singapore (around 15%), etc in order to enjoy some tax benefits for the business.


  • saravanansaravanan subscriber Posts: 389 Silver Level Member
    Company Registration gives you a unique identity
    Registering a business protects you from personal liability
    Registering your business makes you look serious and attracts more customers
  • John G. AnaiJohn G. Anai subscriber Posts: 76 Bronze Level Member
    There are a lot of benefits to register a business. As people mentioned above.
  • UriUri subscriber Posts: 3 Member
    I'm speaking for the US, but totally a fan of registering a business. I would suggest setting a milestone as to when it is worth the time and money to register the business. Before you hit the milestone, it is good to do all the research on where to register and what is needed. Then when you are close, pull the trigger and register.

    As to what you are registering for, I think people have summarized pretty well at a high level the benefits of registering the business with authorities and for tax purposes. I think it also makes sense to register it operationally, i.e. get the right licenses so you can take on larger customers who are conscious of risk AND for IP like trademarks etc.

    Canada is not as litigious as the US so the risk is lower, but not sure where it fits on the spectrum. For your specific example on registering a name, I can only speak for the US, but you can reserve a name for really cheap without registering. That way you can at least partially mitigate the trademark claims
  • ilochkailochka subscriber Posts: 24 Bronze Level Member
    edited June 2019
    Hello all,
    I am thinking of registering my business. I run a small consulting business in the real estate industry. 
    I understand you already have a business. What other registration are we talking about? or did you work illegally?
  • John G. AnaiJohn G. Anai subscriber Posts: 76 Bronze Level Member

    The biggest advantage of a registered business is that it affords limited liability protection to its members.

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