When you’ve got a small business off the ground and running, it can be hard to determine your next step. You can find ways to make your operation grow. Or, if you’re not ready to scale up yet, you can try to protect what you already have.
One great way that you can protect your work and ensure its continued existence is by incorporating your business. What benefits does business incorporation have, specifically? We’ll discuss 6 of them below.
1. You Have Greater Credibility
Once you incorporate your business, it has increased credibility in both the public eye and the eyes of lenders. Let’s face it: Most consumers would rather buy from an INC than an LLC when given the choice between the two.
2. Asset Protection from Creditors and Lawsuits
One of the best benefits of business incorporation is asset protection. You can save your personal assets from seizure by creditors and lawsuits with a corporation at your fingertips. So, you won’t have to fear your home or car being seized due to a bad year. Additionally…
3. Numerous Tax Benefits
When you incorporate your business, you receive numerous tax benefits. Among these is the ability to spread any losses over a longer period.
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Of course, the tax benefits you receive will vary by country. If you’d like to learn what incorporating your business can do for you in Canada, visit opstart.ca for more information.
4. Incorporating Your Business Makes Raising Capital Easier
Banks, like most other clients, put their trust in corporations more than standard small business owners. This is understandable, considering that many small business efforts fail within a year and a bank isn’t guaranteed to recoup its losses. By incorporating, you increase your credibility with banks, making it easier to raise capital for growth or other ventures.
5. Gain a Sense of Identity
When you incorporate your business, you protect its identity. No one can then use its name, logo, branding, or other trademarks without facing severe legal consequences. While you could pursue a business that copied your branding as an LLC, pursuing legal action as a corporation is much easier.
6. Ensure That Your Business Endures
As we mentioned above, most small business efforts collapse within a year of their founding. By incorporating your business, you can ensure that it endures, even if something were to happen to you, your directors, or other management members. This can protect you from messy legal entanglements if and when things go south.
Let’s Review the Benefits of Incorporating Your Business
Incorporating your business can offer a host of benefits. It can grant your business tax breaks, protect its identity, and allow it to endure past its original owners. It also increases your credibility and makes it easier for you to raise the capital you need to take your business to the next level.
While incorporation isn’t for everyone, it can save your assets and give you more room to grow. If you’d like to learn more about business incorporation, check out our blog for more articles like this one.