Launching a business comes with plenty of responsibilities. First, you need to ensure that every aspect of the company is in its proper order, particularly the operations and services. And, aside from making sure every part of the business is in its proper place, you are also responsible for running it legally, which is why you need to know how to register a business in your state.
Business registration may take up a lot of your time, but it is one of the requirements to run the business legally. So, if you are still contemplating having your business registered, these reasons will convince you to do it immediately:
Reason #1: To Avoid Personal Risk and Liabilities
If you register a business, you will reduce the chance of risking your personal assets. Your only liability is equivalent to the number of shares you own in the company. It also helps you prevent using your personal assets for repaying the debts incurred by your business.
Reason #2: To Create a Separate Legal Entity
All registered businesses are considered separate legal entities by law. It means it has its own rights and privileges. However, the company can also own property, operate a business using a common seal, and file any legal actions under its name. Hence, you will be able to take all sorts of calculated risks and secure your assets from getting affected by various legal and financial risks.
Reason #3: To Implement Equity Financing
Having a registered business will make it easier to attract investors and generate more money. The investors and venture capitalists only choose to invest in legally registered companies rather than unregistered businesses without a formal structure. Moreover, if you register your business, you will earn more money through equity financing. It will allow you to sell company shares to prospective shareholders, venture capitalists, and angel investors. It is also more beneficial for your company since you do not have to repay the money you raise.
Reason #4: To Boost Prestige and Consumer Trust
Your business will earn a favourable reputation if you go through all the registration processes. The potential customers will know that you are committed to providing honest and straightforward products and services. It will also allow your third-party service providers to think of you as a stable entity they can trust.
Reason #5: To Open a Corporate Bank Account
One of the most crucial assets of your business is a corporate bank account, primarily if you operate in a partnership, company, or trust business structure. It lets you separate your personal financial activities from your business financial activities. In addition, business bank accounts will allow you to track and control the income and expenses of your company and generate all the information you need to let your accountant meet your reporting and tax obligation.
Reason #6: To Have Heightened Legal Protection
As soon as you register your business with the Australian Securities & Investments Commission (ASIC), your business name will be protected and become yours exclusively. As such, no one can use it anywhere in Australia. As a result, it will protect your company’s name from being illegally used by other entities.
While registering a business comes with many perks, some small business owners have less time to work on the registration process because of their hectic schedules. So, if you need help registering your venture, you can look for a trustworthy service provider to help you simplify the registration process.
