The key to effective business and asset structuring that can stand the test of time is to ensure you tailor your structure not only for the current business activities, but with your eye on the future.
Your structure should allow for growth, provide maximum protection and benefit for you during the operational years of the business, and maximum benefit on your exit from the business.
Some factors to keep in mind include:
Choose the right business structure: The right business structure will depend on your business goals, size, and industry. Each structure has its own advantages and disadvantages, so it’s important to be strategic and choose the one that best fits your needs.
Protect your personal assets: A key consideration in choosing your structure is to protect your personal assets from business liabilities and risks. The right structure can provide an effective legal barrier between your business and personal assets, however there are risks in assuming legal duties of being an officer of a company that need to be carefully considered before you take the plunge.
Consider tax implications: Different business structures have different tax implications, benefits and efficiencies. It’s important to consider the tax implications of each structure during the conduct of the business and on your exit when deciding which one to choose.
Create a clear ownership structure: It’s important to create a clear ownership structure and that you understand how the business is owned and by whom, and the rights and obligations of each owner. Business structures don’t need to be complex to be effective. Clarity can help prevent misunderstandings and disputes down the track.
Get legal and financial advice early: Business structuring can be multifaceted, so it’s important to get legal and financial advice from experienced professionals early. Collaborative advisors that work together to give you tailored financial, tax and legal advice in the context of your wider business plans will set you on the right path.
Reach out to talk to us about business structure options that fit in with your business and personal plans to ensure you set yourself up for success.