Choosing the Entity to Operate Your Business

There are various types of entities you can choose to operate a business. The business structure you should choose will depend on various factors, such as:

• Industry of your business;
• The risks associated with your business;
• How much personal assets you own;
• Whether you have asset protection structures in place;
• Potential growth of your business and future plans.

Some of the most common ways to operate a business, if you are the principal of the business, is as a sole trader, through a proprietary limited company (where you will be the sole director and or shareholder), or through a family trust. If you have a business partner who you share responsibilities with, you may wish to incorporate a proprietary limited company (where all partners will be shareholders), form a partnership, enter into a joint venture agreement, or create a unit trust. Depending on the type of business you wish to conduct, an Association or a public company limited by guarantee may also be suitable.

Our commercial lawyers will be able to assist you in explaining the difference between the structures mentioned above, and suggest which structure will most suit your circumstances from the legal prospective. As the taxation consequences will be a key area of concern when choosing your entity, we also suggest that we work closely with your accountant to achieve the best possible results for you.

Once you have chosen a structure, Prime Lawyers will be able to draft the necessary paperwork including the ASIC required Forms, Constitutions, Trust Deeds and Minutes of Meetings.

Before you commence business you will also need to choose a name under which to trade. This may or may not be different from your entity’s name.

If you are about to start a new business please do not hesitate to contact your nearest Prime Lawyers office to see how we can assist and advise you.

We have business lawyers located at Sydney, Parramatta, Chatswood, Sutherland and Wollongong.