Main Types of Business Ownership Essay -- Business and Management Stud

Different types of ownership of line of reasoning ranging from the simple to the complex. Here I bequeath cover the main types, outlining the advantages and disadvantages of each leading to a decision on which type of ownership is most appropriate for my business.Types of ownership================== on that point argon many different types of ownership of business ranging fromthe simple to the complex. Here I will cover the main types, outliningthe advantages and disadvantages of each leading to a decision onwhich type of ownership is most appropriate for my business. doctor Proprietors================A sole proprietor, or sole trader, is the name given to some sensation whoruns the business by themselves. This is usually someone who isparticularly skilled in one area or had a very good and marketableidea. There are many advantages and disadvantages to setting up a soleproprietorship.Advantages==========Sole proprietorships often require slight capital to bugger run into up tha n the big businesses. This is because they are usually smaller and turn overless staff to start with. This cost is minimal and often only a few speed of light pounds.Sole proprietorships are easy to set up, few forms and licenses needto be obtained and the business can start almost straight away,resulting in less time being unemployed. The only official form youneed to meet in is a inland revenue form for use when connivingincome tax, it also entitles you to many tax advantages outlinedlater. Of course you need to redeem a business plan, complete withcashflow forecasts etc but this was it.These businesses are easy to champion and run. This is because theowner has little or no oppositon for her ideas and plans. Also, it ispossible for the owner to performance as their own accountant, saving themlots of money.The owner has an increased level of control, they have the rite tochange the business whenever they feel like it and have the advantageof non having to call shareholder me etings.One of the largest advantages is the allocation of additions. inappropriatelarger companies sole proprietorships dont need to distribute profitamongst its shareholders. All profit goes directly to the owner, whodoes with it as he or she sees fit.Because of the owners status as a sole trader, she does not need topublish her accounts. Therefore she can detainment her business priv... ...large amounts of debt then the ownerswould not be obliged to pay off any of that personally. This is a bigbonus to the company as it is some(prenominal) easier to attract potentialinvestors who are not willing to risk untrammelled liability. These arethe main advantages of becoming a confine company, and while theydont be much(prenominal) they are actually a huge bonus.Disadvantages=============A curb company has to display information to the public at the endof every(prenominal) fiscal year. Some companies may not want so much informationreleased. It can also be fairly expensive, cos ting a minimum of 700 ayear to prepare a report.Complying with the rules of the London course exchange is also a bigdisadvantage to any limited company and very costly. However companiescan list themselves in the substitute(a) investment market (AIM). Thisis sort of a lot cheaper but is seen as more risky by prospectiveemployers. This can make it quite hard for a business to attract newshareholders.Suitability=========== boilers suit I think this is the most suitable choice for my business. Thisway I am likely to attract more investors plus I would not have tosuffer from unlimited liability.