No matter what country a person lives in, when they are a business owner they want to do everything possible in order to protect their investment in time and money that has been put in to it. Some ways in which a business can be protected is by taking out the proper insurance policies to cover losses in product, damages to the structure or even liability from an accident that happens to a consumer or an employee. Another way to protect a business, especially if it is a small one with few employees is to make sure t is registered correctly. That means to get the proper licensing or paperwork to document the business so it is a legally run venue and not just an operation based off of one person, such as a freelancer or contractor.
Steps to Protect the Business
Protecting a business is not going to be completely free, however, the costs are well worth it for what they can provide. The best way to know what the first step is protecting a business is to check with a consultant who deals with setting up corporations. Just as in the US, there are different ways a business can be established. It can change as the business grows and develops, but the important part is to start somewhere and get the business set up correctly. Besides the expense for the licensing of the business, there will be the consultation fee for the person handling the filing if you don’t chose to do it yourself.
Some of the most popular ways companies can be set up include an LLC, which stands for Limited Liability Corporation and Incorporated. Incorporating in Canada is not so different than if in the United States. Paperwork needs to be filled out, returned to the proper governing body and in most cases, accompanied by a fee. The paperwork is then processed and once it goes through, the business will become incorporated. Protection coverage begins immediately as well as all of the tax perks allowed to businesses in the province. Incorporating a business covers the owner as well as all of the employees who are under that business at the current time.
The consequences of not registering a business properly can be high, in both financial and property ways. Businesses have assumed protection once they are registered in the event of someone suing from an accident, a product malfunction the injured them, a disgruntled employee, a claim of copyright infringement and so on. There are ample reasons a person might want to sue a business, especially if it is a successful one, in order to get ahead themselves. A business that has been incorporated that gets sued, and loses, will then only have company assets at risk. Those assets will also be protected to some extent and so will the employees. However, if the business weren’t properly registered as a corporation, the owner or CEO could be personally liable for the damages awarded in a lawsuit.