You would need to take an additional step to register a company by registering a business name. New to LLC or corporation? Your business name automatically be registered with your country when registering a business name, so you must go through a separate process. If you are a sole proprietor, existing corporation, LLC, or partnership if you want to do business with a name then a registered name.
Are you confused about the corporation, LLC, and partnership stuff, this is not to worry. These are business structures that determine how a business operates from the top down.
Choose an ownership structure!
Choosing an ownership structure as your business entity or business legal structure is one of the legal requirements you need to fulfill when you start a business. A business structure has four different types:
- Sole proprietorship. It is a business owned and run by a person where the government makes no legal distinctions between:
- The person who owns the business
- The business itself
It is the simplest way to operate a business. It doesn’t require your business to have your name as the business name. But, if you want to, give it its uniqueness by registering what is called a DBA (Doing Business As) name.
For example, a freelance graphic designer will run their own business without added help or legally outsourced work.
- Partnership. It is a single business where 2 or more people would share ownership and every owner contributes to all the aspects of the business, including:
- Shares in the profits
- Losses of the business
For example, multiple doctors maintain separate practices in the same building.
- LLC (Limited Liability Company). LLC is a type of business structure that is more difficult than sole proprietorships and partnerships, but less tough than corporations. They are called pass-through entities because they are not subject to a separate level of tax. Most states never restrict ownership on LLCs and members include:
- Other LLCs
- Foreign entities
Most countries permit single-member LLCs – a business with one owner. For example, a small design company owned by a president and staffed by several designers and other employees.
- Corporation. It is a legal entity that is distinct and separate from the owners and with most rights and responsibilities that a person possesses, such as entering:
- Loan and borrow money
- Sue and be sued
- Hire employees
- Own assets
- Pay taxes
It’s more complicated than the other business structures. It is generally suggested for larger, established companies with numerous employees. Corporations seek venture financing with ease. It delivers the best security for personal assets. The founders, directors, and stockholders are not liable for the debts and obligations of a company, only the money and resources they have personally invested.