5 Reasons For Registering Your Business Now

Registering your business is the process of gaining legal sanction to conduct business. It’s a legal obligation in most fields, and it ensures that a business is operating under the law.

The Steps of Registering Your Business

You’ll need to select the jurisdiction which you want your business to be under. Be sure to consider the economic advantages and disadvantages of setting up within that jurisdiction. 

Now, the process of business registration and licensing can start.

You’ll submit a range of documents, certifications, professional references, and a detailed outline of the structure of the company. At this point, you should also have a proposed company name according to your jurisdiction’s legal requirements.

Registering your business gives it a legal entity that protects your business. The jurisdiction also protects you in case of any legal, economic or social instability. Registration is the first requirement for any business during incorporation.

The 5 Great Advantages to Registering Your Business

business card

Identity

After registering your business, the first thing the Business Registration Office will do is check that no other business already exists with the same name (it’s illegal and causes confusion). Be sure to choose a name that no one is already using.

This will also legally protect your corporate image and business name from unauthorized use. Unless your business is bankrupt and is formally disbanded, no other person can use or register your unique name. 

Once completed, you are legally capable of doing anything you want with the name. Now you can get creative and design a logo, business cards, letterheads, and a trademark.

Incorporating your business is great because it allows you to have a business bank account. This is an important asset to your business because it enables you to separate personal activities from business expenses. Also, its much more professional to give your clients a corporate bank name for payments instead of your personal one.

Separate Legal Entity

When you register your business, the law considers it to be a separate legal entity. Your business has rights and privileges like a human person: it can own property, do business under its common seal, incur liabilities, and accuse (or be accused) in its own name.

You can, therefore, take calculated business risks and protect your private assets from certain financial and legal risks.

Its important to know that any debt that your business is obligated to pay, cannot be repaid by seizing your personal assets. You are no longer responsible for the debts (unless you personally guarantee that debt/loan).

However, if you have an unregistered business and go bankrupt or someone accuses you for any reason, you may not be entirely safe. Any outstanding debts your business owes but cannot settle, will be settled using your personal assets (i.e. house, cars, money in the bank).

In general, only Limited Liability Partnership companies have protection. If you operate as a sole-proprietorship and partnership, you’re not protected unless its mentioned as a clause in the legal deed. 

credit cards

Financing your Business

To qualify for the criteria of getting a business loan from any bank, the most important and non-negotiable requirement is to have a registered business. Without it, rest assured you won’t get any form of financing through banks.

Also, investors are more likely to contribute to a registered business rather than one without any formal structure in place. By investing their money, they want to have a share of your business in a legal classified manner, separate from personal assets and finances.

Needless to say, your reputation and prestige are enhanced by the incorporation of your business.

Registering also suggests the permanence and commitment of your business; you are demonstrating effective and responsible management. It gives customers, clients, contractors, and investors a sense of confidence to work with you. 

come in we're open sign

Registering Your Business Gains Credibility

In today’s world, nobody pays for something without demanding a receipt!

And unless you register your business, how will you issue receipts to customers for the products and services you deliver? You may have been comfortable casually selling goods like a local trading business, but when you start to grow, you’ll want to attract more insightful customers.

Registering your business enhances the credibility of your brand image and the impression of your business.

Most companies will not do business without registration, due to regulatory and tax reasons. So once you’re registered, you can be confident about getting more business opportunities.

Continuity

A registered business has a legal identity that enables its continued succession. Million dollar businesses like ITC, Tata, and Ford have existed for decades, and initially started as a small business. 

Most of the people who formed these companies have passed on, but that didn’t affect the existence of their businesses – in fact, they are still omnipresent today.

This is continuity. Human beings live and die but businesses have the ability to last forever as they keep transferring from one generation to another. 

The court can only cease a company’s existence when it formally closes down. So unless that happens, your business can outlive you for generations to come.

Also, like any other asset, you can pass on or sell a registered business to new generations of people who can own or run the business.

The Bottom Line

Registering your business is the best way to expand it. It will help your business to flourish and ensure its success, and you’ll be free from liabilities and pay lower taxes. This will give you more opportunities to focus on turning your business into a lucrative venture.

Learn more about expanding your small business here.

BluRhyn
BluRhyn

BluRhyn is a website development company that specializes in developing and customizing WordPress sites. Our team takes care of everything for you, from customization to maintenance. We strive to make your experience as our client as enjoyable and hassle-free as possible. Please reach out if you have any questions or need help with your site!