Is it feasible For One Person to create a Company?
Are you considering going into business on your own without any young partners? There are two business structures which is appropriate for a little outfit like yours: a single proprietorship (sole trader) or registered company.
While you may consider setting up a single proprietorship, the Corporations Act of 2001 does allow you to pitch a company with only one person to have and run it all. If this is the way you wish to go, then from your to do is indicate your choice in the ASIC registration application as “a proprietary company with limited liability”.
You in order to both the main shareholder and the sole director of your company. The company is legally regarded being a sole shareholder/director proprietary company. You may wonder why anyone would choose to register as a sole proprietary company rather than as one proprietorship.
Well, you will find real benefits to being registered as a sole shareholder/director company. Every potential reasons individuals pick a company of a sole proprietorship:
* Legal personality of company.
Once a service provider is registered with the ASIC in addition to an ACN has been is issued, the company becomes an authorized entity having a personality is actually why independent and separate from the shareholder. The aspect has important facts legally: A company can creep into contracts in its own name and will also sue, and be sued.
If a business enterprise is in debt, the bucks owed doesn’t automatically get to be the debt on the shareholder. For a result, a civil lawsuit for the collection of an amount of cash against the company is not necessarily a law suit against the shareholder.
This happens because the liability of a shareholder has limitations to the price of his shareholdings unless he previously signed a personal guarantee in favor of the one pursuing legal action. This built-in limitation is not available in single proprietorships or for sole traders.
So if you find yourself conducting business by yourself, and you wish to limit your enterprise liability, the actual sole shareholder proprietary company is for a person will.
* Flexibility in ownership
If your business grows later on and you would like to create incentives for your non-shareholder employees who have contributed to your success of your company, then came good way is to grow their involvement by transferring shares in an additional to them.
This likewise known as being a stock route. Because of the company’s structure, you can accommodate non share-holder employees into the particular shareholdings without required to terminate the legal status of the organization.
Another benefit of the independent personality among the company is it may remain for the duration from the registration, notwithstanding changes regarding ownership among the company’s stocks. The death or retirement for a shareholder assaulted sale, transfer or assignment of the rights to some company’s shares will not mean the termination regarding your company’s presence.
You may one day decide to hand over the reins belonging to the company to someone else, regarding one of your experienced managers or employee-shareholders. Even dampness a change of directors, the company will still exist as its registered private.
It is worth it speaking along with a legal adviser or accountant as from what is incredibly best structure by thinking through yourself and firm. Also different countries may hold different legislation on this so check locally also.
It may happen to register a company Online One Person Company Registration in India, nonetheless, if this is often a daunting prospect for you, there are appointed registered agents, to advise and manage your online company registration.