Thursday, October 29, 2009
Methods of trading
Okay, so now you know you want to start a business, but how? You must register your business with the Companies Commission of your country either as Sole Trader, Partnership or Limited Company. Sole Trader If you're running your business alone, perhaps from home, you do not need to register with any official body. But as a sole trader you are personally responsible for all your debts. So your house and car may be sold to pay off debts. To prevent this, many register their house jointly with their wife/husband, and register cars in the name of other family members. Check with your lawyer for your best options. Partnership If there are two or more of you working together and not more than 20 partners, you can register your business as a partnership. All parties in a partnership are collectively and individually liable for the debts of the business. The partnership ceases immediately upon the death of the partners's so it's wise to take out insurance on each of the partners so there is enough money to continue trading. Limited Company By registering your business as a Limited Company, it allows for a more systematic management of your overall business. In the eyes of the law, any losses will be borne by the company and not under your name. So unlike a sole proprietorship or partnership, you won't be personally liable for the company's debts. You'll also find it easier to get loans from banks. Visit the government's official portal, www.gov.my where you'll find easy to follow instructions on how to register your business.