This essay focuses on the business acquires debts. A business structure does not allow for corporate tax rates. The proprietor is personally tax on all income from the business.
Having a business name does not separate the business entity from the owner, which means that the owner of the business is responsible and liable for debts incurred by the business. If the business acquires debts, the creditors can go after the owner’s personal possessions. A business structure does not allow for corporate tax rates. The proprietor is personally tax on all income from the business.
The term is also often use colloquially (but not by lawyers or by public officials) to refer to a company. A company, on the other hand, is a separate legal entity and provides for limited liability, as well as corporate tax rates. A company structure is more complicate and expensive to set up, but offers more protection and benefits for the owner.
Some offshore jurisdictions have created special forms of offshore company in a bid to attract business for their jurisdictions. Examples include “segregate portfolio companies” and restricted purpose companies.
Companies are also sometimes distinguish for legal and regulatory purposes. Public companies are companies whose shares can be publicly trade, often (although not always) on a stock exchange which imposes listing requirements/Listing Rules as to the issued shares, the trading of shares and a future issue of shares to help bolster the reputation of the exchange or particular market of exchange. Private companies do not have publicly trade shares, and often contain restrictions on transfers of shares. In some jurisdictions, private companies have maximum numbers of shareholders.
A parent company is a company that owns enough voting stock in another firm to control management and operations by influencing or electing its board of directors; the second company being deem as a subsidiary of the parent company. The definition of a parent company differs by jurisdiction, with the definition normally being define by way of laws dealing with companies in that jurisdiction.