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E-Myth – “Why most small businesses don’t work & what to do about it”

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Outsourced accounting services | why incorporate

As Intuit the makers of QuickBooks has reported, only 11% of business owners seek professional help when they need it says outsourced accounting services. This is a frightening statistic thinking that many business owners are making uninformed decisions, or not to consulting professionals when they need to. As a result, entrepreneurs have the misconception that incorporating the business is too much work. As a result of this, business owners continue operating their business as sole proprietors, missing out on all of the great benefits of business incorporation. Incorporation can be understood very simply and easily, business owners should know what the benefits are in fact before deciding if itís not the right decision for them.

One of the most obvious and largest benefits of incorporating says outsourced accounting services are the massive tax savings that a business can see as a corporation. The top personal tax rate in Alberta is currently 48%, and small business tax rates in Alberta is only 11%. Most business owners knew that they could save up to 37% in taxes just by incorporating, most of them would more than likely make that choice. But the fact of the matter is it is only one of the many benefits incorporating can offer a business.

If the business is able to save up to 37% in the business, that can greatly affect their bottom line says top accounting services. Since 50% of all businesses fail within the first five years of their business, and 1/3 of those businesses say that running out of money was reason their business failed, therefore it stands to reason that by drastically improving the bottom line of the business by helping them save, will help them overcome this very common problem. This should be a compelling enough reason businesses should decide to incorporate.

In addition to increasing their bottom line says outsourced accounting services, business owners will be able to have much more money that they can use to help them accumulate wealth. One of the reasons why entrepreneurs go into business for themselves, so that they can make more money and accumulate more wealth. By helping save significant taxes in their business, they can invest almost twice as much money as they had previously been investing, which can help them accumulate wealth almost twice as fast.

The third reason that creating such tax savings in the business can be very beneficial to the business is a can save money quicker in order to use that money for by assets for their corporation. Any businesses who require buying hard assets such as equipment, vehicles or even a building, can build up the money to buy those things quicker as they are saving more taxes says outsourced accounting services.

In addition to saving up to 37% of taxes, business owners can save considerable money towards wealth accumulation, they can positively affect the bottom line of the business and avoid running out of money, as well they can say that money so that they can buy hard assets that can help them run their business.

Outsourced accounting service | why incorporate

Entrepreneurs think that itís far too much work to incorporate their business says outsourced accounting service, therefore they are not reaping the benefits that they would be able to be receiving if they decide to incorporate their business rather than operate as an unincorporated business or a sole proprietor. Aside from the obvious tax savings that businesses can enjoy as incorporation, is also several other reasons why a business owner should decide that incorporating is the right for their business.

The most compelling reasons to incorporate their business other than the tax savings is that businesses who incorporate reduce the personal liability of the business owner. Entrepreneurs are not aware that they are at personal risk of being sued if they arenít incorporated. Which means every time they work on a job, or enter a job site, they run the risk of being personally sued. Being personally sued means that on the person is at risk, but so are all of their assets. If they have a house, thatís at risk and if their family is living in that house, a family is being put at risk as well. Business owners can immediately eliminate their personal liability by incorporating. Incorporation assumes the liability says outsourced accounting service, immediately protecting them and their assets. What business owner wants to shoulder that kind of liability on their own? Incorporating can not only protect them, it can put their mind at ease.

Another reason why businesses should incorporate is that if they donít incorporate, some businesses will not hire them. Many business owners are again surprised to learn that says outsourced accounting service, and the reason for that is because some companies want to eliminate their own risk, and by hiring companies that arenít incorporated, those businesses must consider the worker from that incorporated business their employee. That puts that business at significant risk, that they may choose to eliminate by saying they will only hire businesses or contractors who are in fact incorporated. Many business owners are not in the position to turn down work, being incorporated means that they will be able to accept a higher percentage of jobs.

The third reason why businesses should incorporate says outsourced accounting service is that they may not be able to get a WCB number without incorporating. The WCB often controls who gets a number, limiting the numbers to just prime contractors. By not incorporating, WCB has turned down businesses in the past. That also can limit the number of jobs a business can take, and puts them at risk for getting kicked off the job site.

Business owners should consider incorporating in order to enable businesses to land every job, to limit their personal liability, as well as enjoy the significant tax savings that incorporating brings business owners. It is an easy process, that can be completed as an accountant ís office within a day.