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Tip 11. Protect Your Assets

  

Businesses come in many shapes and forms. Some businesses are operated by the owners in their own name, others use a partnership, corporation or trust structure. Each type is known as a "vehicle".

It's important you understand your choice of "vehicle" will have major legal and accounting implications.

I would usually recommend people avoid running a business as an individual. This is because if you are an individual and you are sued then your personal assets may be on the line.

Get advice about the best way to operate your business as soon as possible.

Another implication is the tax treatment. Generally speaking, individuals are the highest taxed entity. I always say that you should pay your share of taxes, but anyone who doesn’t try to legally minimize their tax has too much money. If you don't have a plan for your money it will be taken by others who do.

Steps For Immediate Results

  1. Work out if you have the right structure for your business. The right structure will protect you legally and also maximize taxation opportunities available to you. If you don't know if you have the right structure, use my free report on how to find a great accountant.

  2. Become educated about the differences between companies, trusts and individuals. Check out my research page for a good list of books and other resources to help you.

 




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