Before starting a business, it is important to consider and identify the most appropriate business structure for your circumstances.
How you structure your business from the outset can impact certain business operations, the way your business is taxed and even the way you exit or transition from your business in the future.
Many new business operators make the mistake of jumping into a particular business structure without considering the long and short-term, and potentially costly, effects it may have.
A common mistake is thinking that because the business is new, then a company structure is the correct choice, and the owners don’t properly consideration other options.
A company structure is not always the best option for new business operators. Setting up as sole trader might suit your situation better, or a specific trust structure could be a better option, or if going into business with another, a partnership may suit best.
It is important to get advice and consider all options available to you, otherwise you could find yourself in a business structure that increases your liability and costs, restricts your potential, and ends up costing you more tax.
By set up the correct structure for your business from the beginning will save you stress and money in the long run.