I trust we all had a super productive week. Let’s end the week on a high with the STRUGZ TIPS. It is essential that we discuss the entity selection process; In order to help you decide the best entity suitable for your business, it is known that, the “choice of entity” is one of the most important decisions you need to make for your company.
The entity determines your business structure and stand as an influence to everything you do, from your day to day operations, to taxes, and to how much personal assets are at risk.
Consider all the factors governing each entities while making an entity selection, and endeavour to choose a business entity that will give you the right to balance both legal protections and benefits. Remember that, it is important to stay safe than risking your business.
Below are some entities you can choose from, in Nigeria:
1. Sole proprietorship: Sole proprietorship is the simplest business structure, it is easy to form and gives you complete control of your business. A proprietorship is one individual owning and operating the business alone.
2. Partnerships: Partnerships are the simplest and easiest structure for two or more people to own a business together. It is a company own and run by at least two individuals.
3. Limited Liability Company: A limited liability company is a private company whose owners are legally responsible for its debts only to the extent of the amount of capital they invested into the business.
4. Corporation: A corporation is a legal entity that is separate and distinct from its owners. They are independent legal entities and comply with more regulations and tax.
5. Incorporated trustee: An incorporated trustee is a corporation, usually a trust company, which is named as the trustee of a private trust or other fiduciary account. It is usually used by a non-governmental organizations.
Each entity has its own advantages, disadvantages, tax consequences and legal requirements. Therefore, as a business owner, you need to be certain on the kind of business you want to run in order to choose an appropriate entity suitable for your brand.
Remember to subscribe to my channel (Strugz Tips) and watch this space for the full information on Entity and some question you need to ask before making an entity selection.