There are many forms of business organization open to you, but two of the most common are the sole proprietorship and the incorporated business.
Both can apply to small business; and choosing the one that is best for you depends on your personal situation and the growth-stage of your business.
Issues to consider:
- Simplicity: sole proprietorship is a simpler business model.
- Tax: there could be tax benefits to incorporating your business.
- Cost: it usually costs more to incorporate and keep separate books.
- Liability: there can be greater liability exposure to the owner of a sole proprietorship.
Not sure? Ask someone!
While there is no single answer to what is right for you and your business, you should be aware of the issues. While you can incorporate without the help of a professional, it is usually not advisable. Having a lawyer and/or accountant go over what will work best in your situation will place your business on a better foundation.
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