No quod sanctus instructior ius, et intellegam interesset duo. Vix cu nibh gubergren dissentias. His velit veniam habemus ne. No doctus neglegentur vituperatoribus est, qui ad ipsum oratio. Ei duo dicant facilisi, qui at harum democritum consetetur.
A company is a common form of business structure. Under law it is considered a separate legal entity, entitled to sue and be sued, enter into contracts and own property. This offers a level of legal protection not available to other business structures.
The main benefits of a business are:
The business pays the flat corporate tax rate. This is lower than the highest rate for individuals.
The debts and liabilities of the business are separate from the director(s). Creditors of the business cannot access the personal assets of the directors (unless the directors have provided a personal guarantee).
The business structure of a company allows for an ongoing existence in the event of management or personal changes.
The disadvantages of a business include:
The need to comply with strict regulations.
The greater cost involved in establishing the business.
Profits distributed to shareholders’ are taxable.
Lenders are often reluctant to provide finance unless they receive a personal guarantee from directors or shareholders.
If you have further questions, please contact us at frank@franklaw.com.au
This is not legal advice.
Written by Tim Cargill & Zdenka Marinov and edited by Andrew Graham.
