Page 55 - MICROHUB Handbook - ENGLISH

GETTING STARTED:

CHOOSING A LEGAL STRUCTURE

FOR YOUR BUSINESS

With your business idea developed and tested, you are now ready to

formally set up your business. The legal business structure you choose

will influence everything, from day-to-day operations, to taxes and how

much of your personal assets are at risk. You should choose a business

structure that gives you the right balance of legal protections and

benefits.

Start by analysing your company’s goals and the laws that will regulate
your business. Remember that you can change your business’ legal

structure further along the line, as it grows. Here are some examples of

Business forms used in Europe:

The majority of new SMEs register as Private Limited Companies,

designated as Ltd. or Limited.

Proprietorship is a type of business entity that is owned and run by

one individual – there is no legal distinction between the owner and

the business. Sole Proprietorships are the most common form of

legal structure for small businesses.

Nonprofit corporations are organised to do charity, education,

religious, literary, or scientific work. Because their work benefits the

public, nonprofits can receive tax-exempt status, meaning they are

not required to pay state or federal income taxes on profits.

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