How to Set Up a Company

A company is a legal entity that’s separate from its owners and managers. It has the legal personhood that comes with a separate identity, perpetual existence and common seal. It can own assets, incur debts and hire employees.

Companies are generally organized to earn a profit from business activities and are an important contributor to the economic health of most nations. They also offer protection to their owners from personal liability. However, there are many things to consider before taking the leap of starting a company. The main challenges include: financial risk, long hours, health risks due to stress and regulations. Despite these disadvantages, it is possible for entrepreneurs to succeed and amass great personal fortunes by starting and growing their own companies.

Before starting a company it’s important to understand what the different types of company structures are and which one is right for you. For example, small business owners often choose a proprietary limited company (which has the abbreviation ‘Pty Ltd’ after its name) to limit their liability. It is a popular choice for entrepreneurs as it is simpler and less restrictive than a corporation.

For those looking to set up a company in the US, there are a few more steps involved including choosing if you want an LLC, S-Corp or C-Corp, registering your company, getting an EIN and establishing all your business details such as mailing address and phone number. In addition, there are additional income tax issues that non-residents must take into account when setting up a US company.