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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 | benefiting from and incorporating

Business owners do ít believe that incorporating their business will benefit them says outsourced accounting services. Or they think that it will be too much work, be too time-consuming, or that their business is not eligible to become incorporated. The truth is all businesses can be incorporated, itís much easier than most business owners realize, and that businesses can start saving money immediately when they incorporate their business. There is no reason for a business to not incorporate. This article will show why beyond a reasonable doubt all businesses should incorporate their business immediately.

The first benefit of incorporating, and often the most important one to most businesses is the tax savings business owners can see through incorporation. The top personal tax rate in Alberta is 48%. That means regular citizens are paying up to 48% of their income back to the government. Most business owners go into business for themselves in order to positively affect their future, being able to control how much wealth they create for themselves. By not taking advantage of the tax savings through incorporation, business owners are missing out on the largest benefit of incorporating. The small business tax rate in Alberta is 11%. That is the tax savings of up to 37%. There is no businesses in the world that would not want to save 37% of taxes. Businesses that incorporate can start saving these taxes immediately. This is the biggest and most important reason why businesses may choose to incorporate.

One of the reasons is such a large tax savings is so important says outsourced accounting services is that business owners who are trying to accumulate wealth. They are saving for their retirement, or creating a nest egg for their family and children. By saving up to 37% in taxes, entrepreneurs are more easily able to save up that money to put towards their wealth accumulation. Businesses who donít incorporate, are not able to put that 37% anywhere. Business owners who are serious about saving money definitely want to incorporate their business to benefit from the tax savings.

The second reason why such a large tax savings is important to business owners explains outsourced accounting services is that businesses who purchase assets for their business, can more quickly save up the funds required to make those purchases if they are not paying 48% taxes. Some of the assets that a business owner may choose to purchase for their business is a building, so they can lower their rent cost, as well as perhaps earn money from other mentors. They may want to buy vehicles for their business, or machines. Machines and equipment to help them make their product, are seen as assets in a business and if businesses have more money in which to buy those assets, they are able to make those purchases sooner, benefiting their business.

These are just two reasons why saving significant taxes in business through incorporation is so important. If business owners know these two benefits, they should incorporate their business immediately.

Outsourced accounting services | benefiting from incorporating

Entrepreneurs donít understand the benefits of incorporating, ays outsourced accounting services. As Confucius said life is really simple, but we insist on making it complicated. Similarly incorporation is really simple, but business owners insist on making it complicated. Incorporating a business is fast, easy, and can benefit a business owner and so many ways. this article will outline some lesser-known ways that companies can benefit from incorporating.

Most business owners are not aware that they may not be able to get WCB coverage if they are not incorporated. Outsourced accounting services confirms that the WCB does not issue WCB numbers to businesses who are not prime contractors. If a business is not incorporated, then WCB may not issue that number. If the business does not have a WCB number, they may either not get hired for a specific job, or they may get kicked off the job site for not having one. Some business owners believe that they will be covered under the main contractors WCB number, and this is not always the case. To protect themselves and to ensure that they can handle any job that they are hired for, entrepreneurs should incorporate immediately.
The second reason that businesses should choose to incorporate that is lesser-known, is that by incorporating, businesses are actually protecting their tradename. Outsourced accounting services that many businesses believe that by merely registering their name with registries protects their name legally. However this is not the case, if another company incorporates the business after the first company has registered the name, the company that has incorporated retains greater legal rights to that name. Which means a business could spend significant time, energy and advertising building their brand only for a not your company to come in and take that away from them. Businesses should protect their tradename by incorporating immediately.

The third benefit that is lesser-known about incorporating is becoming incorporated lowers the entrepreneurs personal liability. Outsourced accounting services confirms that businesses who donít incorporate hold the personal liability for their company. Which means they run the risk of being personally sued every time they are on a job site. This is very scary, considering being personally sued doesnít just affect the business owner, it affects their assets such as their house and car for example. In order to protect their assets and their family living in those assets, business owners should incorporate in order to allow the Corporation to assume liability rather than them personally.
These are three very compelling reasons why business owners should choose to incorporate their business rather than run sole proprietorships. Not only is there significant tax savings, but to avoid getting sued, to protect their trade name, as well as being able to get there WCB number in order to take jobs are the most important secondary reasons why business owners should choose to incorporate their business as quickly as possible. It doesnít take much time, and they can start seeing the benefits instantly.