TOPIC 1 :: Legal forms and governance :: MODULE 2. GET STARTED! TOPIC 1 :: Legal forms and governance ::   This project has been funded with support from the European Commission. This publication reflects the views only of the author, and the Commission cannot be held responsible for any use which may be made of the information contained. therein

European Incubator for Business Ideas (EIBI) Legal Forms and Corporate Governance The business structure you choose will have legal and tax implications; Choosing an appropriate structure for your business is one of the first business decisions you will make; There are pros and cons to the different structures, legal or otherwise, and forms of governance; You will become either a sole trader, form a partnership, or incorporate a limited company; What your business aims and objectives are and how you want to operate will influence the structure that you choose. Ésta es otra opción para una diapositiva Información general. CASE STUDY!!! https://www.youtube.com/watch?v=dWTcKgBmV9M

European Incubator for Business Ideas (EIBI) Sole Trader The business structure you choose will have legal and tax implications; A sole proprietorship is the simplest and most common structure chosen to start a business. It is a business owned and run by one individual with no distinction between the business and you, the owner carries sole responsibility and legal identity. Advantages Disadvantages Easy and inexpensive to form You have complete control Easy tax preparation Unlimited personal liability You may find it hard to raise funds or stock Sole burden for business Ésta es otra opción para una diapositiva Información general. CASE STUDY!!! https://www.youtube.com/watch?v=dWTcKgBmV9M

Partnership: European Incubator for Business Ideas (EIBI) A partnership is a single business where two or more people share ownership; Each partner contributes to all aspects of the business, in return, each partner shares in the profits and losses of the business; It is always recommended to develop a legally binding partnership agreement. : Three different types of partnership General Partnerships: Profits, liability and management duties are divided equally among partners. Limited Liability Partnerships are more complex than general partnerships. Limited partnerships allow partners to have limited liability Joint Ventures act as general partnership, but for only a limited period of time or for a single project. Advantages Disadvantages Easy and Inexpensive. Partnerships are generally an inexpensive and an easily formed business structure. Shared Financial Commitment. Each partner can pool resources to obtain capital and therefore credit. Complementary Skills. Good partnerships benefit from using the strengths, resources and expertise of each partner. Partnership Incentives for Employees. Partnership incentives often attract highly motivated and qualified employ Unlimited personal liability You may find it hard to raise funds or stock Sole burden for business Ésta es otra opción para una diapositiva Información general.

European Incubator for Business Ideas (EIBI) Limited Company Limited Companies normally consist of 2 broad types, namely Limited by Share (for profit) Limited by Guarantee (social enterprise); Each country will be subject to its own legislation and process; Company details will be held on a register and be publicly recorded; All Limited Companies have Directors and are governed by a document detailing the activities and responsibilities of the business; To comply with company legislation all Limited Companies must file accounts and particulars of any Directors, Key Stakeholders. Advantages Disadvantages Easy and inexpensive to form Straightforward compliance requirements Ability to enter into contracts, employ staff, and seek finance. Administrative and regulatory demands heavier Annual accounts and financial reports must be placed in public domain You will be responsibility as a Director to make sure that the business is complaint Ésta es otra opción para una diapositiva Información general. CASE STUDY https://www.youtube.com/watch?v=mAAeIKjGf_k