ИП or ООО: what to choose

Often, having conceived to organize their own business, the entrepreneur faces a difficult choice. On the one hand, it can be formed as an individual entrepreneur, on the other - choose a more presentable form of organization like LLC or CJSC. Some newcomers to the business are not very clear about the differences in these organizational forms.

Before choosing a PI or LLC, it is necessary to take into account all the pros and cons of these organizations and understand the difference between an LLC and an IP. IP is the simplest form of doing business. The status of unincorporated business can be obtained by spending a minimum of funds. Individual entrepreneurship does not require the availability of authorized capital.

Beginners often ask: IP or LLC - which is better? In fact, you can not say that one form is better than another. It's just that each of them has advantages and disadvantages.

IP, being a simpler form of doing business, also has disadvantages. For example, in the event of a debt, an entrepreneur may lose all his property. In the calculation there is even an apartment and a car that do not have a direct relationship to the firm. At the same time, IP can be registered only at the place of residence, and business can be conducted all over Russia. Choosing, IP or LLC to open, we must remember that LLC (and CJSC) has a more complex reporting system. A limited liability company is subject to a large tax. Such organizations should compulsorily conduct tax reporting and provide it as required.

However, in some cases, the organization of an LLC or a CJSC is necessary. It is known that not everyone takes seriously individual entrepreneurs. LLC vylyadit more prestigious and presentable. The entrepreneur who designed the IP has a stamp of the format "Ivanov AA A.". This is the official name of his organization. If you plan to create a large-scale production, then such a print will look comical. Reflecting on whether to choose a PI or LLC, one should dwell on how important this will be for doing business.

For example, for small shops, where goods are sold in small retail, there is no difference. But for those organizations that will have to cooperate with other companies, this can be very critical. If the firm is created for sale, it is better to choose not IP or LLC, but more serious CJSC. Of course. The cost of clearance is much higher. So, for the organization of IP it is necessary to spend 800 rubles, for the company - 4 thousand, and for the company - 24 thousand rubles. But at the same time, the organization of the company is much easier to file. IP sell as a firm is difficult, because it is fully framed by the owner.

LLC is an average option between a non-representative IP and an expensive CJSC. In addition, it is easier to attract shareholders and investors in CJSC, and for PI or LLC this is a very difficult task. Most of the really large organizations have the form of JSC. This allows them to freely issue shares and attract significant capital. A CJSC may have a limited number of shareholders.

If the business is not formed for sale and there are no plans to attract outside capital, then the IP can be made. This will allow to carry out activities across the country, facilitate reporting, but it will not create the necessary image for the company. This form is very attractive for retailers. It does not require the registration of branches and a report on the equipment in the workplace. While for LLC the report for the equipment is mandatory. When opening a new office, the company is obliged to notify state structures about this. Both for the LLC and for the IP there is both a general taxation system and a simplified one. Therefore, worry about the fact that when the company does not manage to formalize "simplified", it's not worth it. It is more important to decide whether the registration of the costs of the reporting that the entrepreneur faces is worth it.