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Q: How do I get my company to be legally recognized? ( No Answer,   7 Comments )
Question  
Subject: How do I get my company to be legally recognized?
Category: Business and Money > Small Businesses
Asked by: garyking-ga
List Price: $2.00
Posted: 16 Feb 2005 15:03 PST
Expires: 18 Mar 2005 15:03 PST
Question ID: 475681
How do I get my company to be legally recognized?

I have a website ( www.vbpros.net ) which is my 'company', but not in
a legal manner. How can I get it to be my 'actual', 'legal' company?
And, do I get any extra benefits? Basically, right now it is just a
website where I conduct business through. All my business is online,
so it all goes through the website or directly to me, online (through
email, or IM, or phone.)

Thanks in advance!
Answer  
There is no answer at this time.

Comments  
Subject: Re: How do I get my company to be legally recognized?
From: ipfan-ga on 16 Feb 2005 15:48 PST
 
Gary,

You are located in Canada, correct?  I presume Canadian laws in this
regard are fairly similar to US laws.  Under US law, at the moment you
re a "sole proprietorship."  In other words, you and the business you
run at abpros.net are one in the same.  It's revenue is your revenue,
its expenses are your personal expenses, and so on.  So in that sense
you are a business.  You could set up a separate checking account for
this sole proprietorship and in the US you can (and in fact are
required) to file what is known as a DBA certificate or a Certificate
of Assumed or Fictitious Business Name. This is to let the world, and
especially your creditors, know that when they are doing business with
vbpros.net, they are actually doing business with Gary King.

If you want, you can certainly adopt a more formal business structure,
like a corporation or a limited liability company.  I am sure a
Researcher versed in Canadian corporate law can assist you with advice
on how to do that under provincial law.  In general, there are some
tax benefits and some liability limitation benefits that arise from
more formally organizing your business, but depending on what you do
and how much money you make, you may not need to ever be more than a
sole proprietorship.
Subject: Re: How do I get my company to be legally recognized?
From: garyking-ga on 17 Feb 2005 13:11 PST
 
Okay, thanks! And also, yes, I am located in Canada.

Also, but wouldn't registering my company protect me better as well?
Just curious as to all of this, thanks again!
Subject: Re: How do I get my company to be legally recognized?
From: ipfan-ga on 17 Feb 2005 13:36 PST
 
You ask: "wouldn't registering my company protect me better as well?"

Yes, if you adopt a form of limited liability entity like a
corporation or a limited liability company.  Those are called "limited
liability entities" because they stand as a barrier between your
personal assets and the outside world, to the extent the bad act from
which you seek protection was committed by your company and not by you
acting as an individual.  But do you need a limited liability entity? 
Most of the world's small businesses run as sole proprietorships
simply because what they do does not create enough potential liability
to warrant the time and expense of setting up the entity and
maintaining it.  For example, if your business is to make and sell
small crocheted butterflies out of organic thread and dyes, I think it
is unlikely you are going to get sued.  On the other hand, if your
business is to apply mercury vapor and lead-based paint using a high
velocity air gun in nursing homes, then yes, you'd better form a
limited liability entity behind which you can hide your personal
assets.  You see, as a sole proprietor, your assets are the company's
assets, and if one of those nursing home residents sues your business
for personal injuries caused by the paint, the "business" is you, and
your personal cars, homes, checking accounts, whatever can be used to
satisfy the judgment.  If, however, you have, e.g., a corporation and
it is the corporate business that applied the paint, it is the
corporation that must be sued, and your personal summer home in
Saskatchewan is not subject to the judgment (assuming you keep your
corporate nose clean and don't do anything that would permit a
plaintiff to pierce the corporate veil, as it's called).
Subject: Re: How do I get my company to be legally recognized?
From: garyking-ga on 22 Feb 2005 14:38 PST
 
In the situation that I am in right now, can I technically tell
someone else that I have 'my own company'? Or legally, as well?
Subject: Re: How do I get my company to be legally recognized?
From: ipfan-ga on 22 Feb 2005 15:34 PST
 
I think that is fine, since technically and legally you do have your
own company, a sole proprietorship called vbpros.net.  But I would
double check provincial law to make sure there is no requirement that
you file what in the States is called a Certificate of Assumed or
Fictitious Business Name, also known as a "D.B.A. ("Doing Business
As") Certificate."  If there is such a requirement, you should file
that document before you hold yourself out as "a business" or "a
company."

So assuming there is such a requirement and further assuming you file
such a form, thereafter you may legally hold yourself out as, "Gary
King, d.b.a. vbpros.net."  If there is no such filing requirement,
then right now you are legally "Gary King, d.b.a. vbpros.net."  That
is how you would, e.g., apply for a business bank account--that is the
name the account would be in.  For business cards or whatever, you can
say, "Gary King, Owner, vbpros.net."
Subject: Re: How do I get my company to be legally recognized?
From: garyking-ga on 22 Feb 2005 17:18 PST
 
If, like you said, I used ""Gary King, Owner, vbpros.net." on business
cards, then do I still need to get a d.b.a. certificate?
Subject: Re: How do I get my company to be legally recognized?
From: ipfan-ga on 23 Feb 2005 08:38 PST
 
Only if the laws of the province in which you live require you to file
a dba certificate before you commence business as a sole
proprietorship.  You need to check with a lawyer now.

There is no legal difference between saying "Gary King, d.b.a.
vbpros.net."  and, "Gary King, Owner, vbpros.net."  They both mean the
same thing:  "Gary King = vbpros.net."  One is just less
formal-sounding than the other IMHO.  In both cases you are holding
yourself out as a business.  The issue of whether you have to file a
dba certificate depends strictly on your local laws, not on how you
hold yourself out or how you advertise or anything else.  Talk to a
lawyer and see if you have a dba filing requirement in your province
or city.  Technically speaking, right now you ARE a sole
proprietorship.  The only issue is whether you local laws require you
to make a dba fling before continuing in business as a sole
proprietorship.

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