Hutchinson Legal has expertise in providing assistance to businesses in terms of choosing a suitable business structure. Most businesses operate in one of the following ways:
- sole trader – the most straightforward business structure; generally speaking the sole trader is responsible for both the assets and liabilities of the business
- partnership – where two or more persons or legal entities carrying on a business in common with a view to profit. The responsibility for both the assets and liabilities of the business are joint and several.
- Company – a Company structure is often used to limit liability; it is a separate legal entity and it can enter into contracts in its own right. Shares will be issued and held by separate individuals or other companies. Directors are appointed to run the affairs of the Company.
- using a Trust structure where a Trustee is appointed to hold property, earn income and distribute income to a specified class of beneficiaries. Sometimes this structure may give some tax advantage.
When considering the type of business structure to adopt, it is important to consider the nature and scope of the business, the desirable degree of protection for assets, financing requirements and taxation issues; we are able to advise on these issues.