Which business structure is right for my business?
SOLE PROPRIETORSHIP – Any person who endeavors to produce and distribute a service or product in return for compensation, and who shall alone be the owner and benefactor of the profits of the business, and who shall alone be liable for the activities and liabilities of the business, is considered to be the operator of a “sole proprietorship” and should be aware and compliant with any business or tax requirements in the targeted industry.
PARTNERSHIP – A group of 2-20 people, but not to exceed 20 including companies and LLC’s which may also be partners in a partnership. A partnership company would operate under the same jurisdictions as a sole proprietorship except that the profits of the business, and who shall be liable for the activities and liabilities of the business, is considered to be shared equally among the partners.
CORPORATION – A company or group of people authorized to act as a single person united, and is recongnized by law as such. A corporation may also be the structure of administering a municipality.
LIMITED LIABILITY COMPANY LLC – (USA) – A form or structure which allows for the passing of company liabilities on towards the shareholders of the LLC company. This structure is not recognized in Canada but acts as any other entity in so far as participating in and with other entities. It is mentioned here only so that you are familiar with this structure as you will see the letters LLC after a company name instead of Ltd. or Inc.