If you visit this page you are most probably in process of a company registration or busy exploring some ideas about how to structure your business.
Earlier years you had the option of using Closed Corporations, Private Companies, trading as a sole proprietor and some people even trade in business Trusts.
After the new company act came into effect .... Closed Corporation fell away and the typical small business entity became a Private Company.
We suggest the following structure to protect your new business from your personal estates.
From day one you can be the director of the company...the director need to manage the daily activities of the business. Create a Trust to hold ALL shares in the company.
You will need to do this for mainly two reasons:
1. To ring fence your business from risks outside of the business.
2. If the
shares of the company are in your personal name and only be transferred on a
later stage you can have a capital gains tax problem and a loan account as an
asset in your name .... Because the transfer will be deemed to be a sale of the
shares at the market value of the business at the date of transfer.
If finances allow it from day 1 of your business ... do create a Trust and let it hold the shares of your newly created company.
Never let a Trust that stand surety for a bond of a properly or other debt be the owner of the shares of your company. If I may be a devil's advocate ..... when this trust gets liquidated the value of the shares will be part of the asset of the Trust.
For new business owners we created 5 different company registration start-up packages to provide you with all your needs.
This includes the following:
Company register book
Standard bank Biz Launch account (with limited bank charges of R 90 per month)
Income tax number
VAT registration number (to be registered)
Electronic logbook system - tripTrack lite
Standard creation of a Trust