Do you have a business or are you planning to start one? Are you thinking of incorporating your business? Do you wanna know the benefits of incorporating? If yes, read the article below entitled Why Incorporate written by Steve Valentino.
It is important to know how much money you should risk, and incorporating a business venture reduces the risk and the personal liability. There are many advantages to incorporating a business. They are personal liability, tax advantages, anonymity, perpetuity, easier access to capital and transfer of ownership. A Corporation is made up of a group of persons called shareholders. Each has limited investment in the venture. The benefits they accrue is in the form of salaries if they are employees, as well as dividends and capital appreciation if the shares are listed. If the business incurs any loss, the shareholders are liable only for their investments. Their personal assets are protected.
Corporations enjoy many tax advantages when compared to proprietorship and partnership. Many expenses like rents, insurance plans and retirement plans can be claimed for deductions. In proprietorship and partnership, debt is the only way to raise capital. This comes at a higher interest due to unlimited liability. But corporations can raise capital by selling shares and can borrow money from institutions because of the credibility. As ownership is held in the form of shares, it is easy to transfer ownership by selling the shares. Corporations exist on their own by their legal entity status. This makes the corporation live longer and provides the founders anonymity as they are separate from the corporation.
To read the full article, click Why Incorporate by Steve Valentino
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