If it is your dream to start your own company you may very well ask “Why incorporate my business?” There are many blessings to be had with incorporating your company; at the end of the day, it is up to you whether this is a path you chose to follow or not.

The first advantage of incorporating a business is the reduction in taxes that you will have to pay. Generally the tax rate is lower than an individual tax rate and the corporation is taxed separately from their owners. It may be that your company has to be earning a specific amount before it benefits from a lower tax rate, which is something to bear in mind.

Businesses that are incorporated also have better access to Capital. They can generally borrow money from banks and other financial institutions at a lower rate. This is because it is deemed as less of a risk that loaning money to other kinds of businesses. Corporations also have the advantage of being able to raise money more easily than other types of businesses, which have to rely completely on their own money.

A corporation’s shareholders can also benefit from this process. Liability is limited in a corporation so shareholders are not held responsible for things such as the company’s debts. The investment that they made when the company was formed is protected and they cannot be sued by Creditors if the business should go bankrupt.

If you are still asking, “Why incorporate?” then consider the fact that incorporated organizations are much more stable than business like partnerships. The company exists until it is dissolved even if the directors, shareholders and owners cease to exist themselves. A corporation will be passed on to any heirs that the shareholders, directors and owners had and this transfer is easy to do.

Some people view the process of incorporating as a fussy and complicated process. If this is the case, you can opt for ready made companies. These are available on the internet, for example, and have been specifically constructed to start trading immediately. This takes the incorporation registration process out of your hands as it has already been done; you basically have to arrange for the company to be out in your name.

Choosing a ready made company with a history may be of benefit to you. The older a company, is the more prestigious it will appear to be. The companies are already registered saving you time and money. The cost of these ready made companies will vary depending on several factors.

This information should hopefully answer the question “Why incorporate?” all the advantages and disadvantages of incorporating a business should be thoroughly explored before making your mind up. You can gather more information by entering “why incorporate” into any search engine.