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Ask HN: At what point did you incorporate for your startup or side project?

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Re: Ask HN: At what point did you incorporate for your startup or side project?

#51

Post by ajeet_dhaliwal »

matthewmacleod wrote: post #50
ajeet_dhaliwal wrote: post #44

Earlier quoted context omitted.

The LLC is great for smaller businesses and startups. Which is why it's a shame countries like the UK and Canada have no such structure and business owners are left to choose between sole proprietorship and a corporation. I have lived in both of these places and I know the governments in both talk a lot about promoting small business and entrepreneurship but talk is easy, they need to do the work necessary to make co…

I’m not too sure what problems you feel a UK private limited company has. It’s super easy to set up, requires minimal paperwork, and indeed most IT contractors I know work through their own limited companies.

They have no other choice. A private limited company is like a US corporation, it doesn’t have the pass through income an LLC does.

Re: Ask HN: At what point did you incorporate for your startup or side project?

#52

Post by tempestn »

kohanz wrote: post #45
nish1500 wrote: post #19

I haven't incorporated and don't intend to. I don't need limited liability, and I am not working with companies that require me to incorporate. Incorporation would mean a ton of paper work, more taxes (in Canada at least), more complications, and 3x the accountant's fees. For what it's worth, my project nets 200k, is 3 year-old, and I have a degree in accounting and taxation.

I run a sole prop in Canada too. I agree for the most part, but I think the "more taxes" aspect would be very situationally-dependent. Perhaps if you intend to flow all of the corporations earnings through as income immediately then you may pay more taxes, but often one reason to incorporate is to be able to defer those taxes by only taking the income that you require at the time (tax deferral to years when you'll be…

This is all true, but if you haven't seen them already, you'll probably want to read up on the changes that are being proposed to taxation of CCPCs currently. All the details are supposed to come out with the 2018 budget, but here are some blog posts covering the developments so far:

http://www.thebluntbeancounter.com/2017/09/tax-planning-usin... http://www.thebluntbeancounter.com/2017/10/tax-planning-usin... http://www.thebluntbeancounter.com/2018/01/the-revised-tax-o...

Re: Ask HN: At what point did you incorporate for your startup or side project?

#53

Post by juicy-fruit »

nish1500 wrote: post #19

I haven't incorporated and don't intend to. I don't need limited liability, and I am not working with companies that require me to incorporate. Incorporation would mean a ton of paper work, more taxes (in Canada at least), more complications, and 3x the accountant's fees. For what it's worth, my project nets 200k, is 3 year-old, and I have a degree in accounting and taxation.

Ah man. I'm in Canada too and I wanted to incorporate for the sole reason of getting a Apple Developer account as a company instead of having my name. This would make my "startup" seem more legit. I guess even if an accountant doesn't want to bother with the headache of paperwork and taxes, I shouldn't either.

I'll just get a regular developer membership instead.

Re: Ask HN: At what point did you incorporate for your startup or side project?

#55

Post by tudelo »

client4 wrote: post #34

You should incorporate when you make $1500 and/or when you need to start signing contracts. Why $1500? Stripe Atlas is $500 (comes with enough AWS credits to host your app for at least a year) and your increased accounting cost will be ~$1000 which is a high estimate. Your company will start at break even, and you will be able to start a clean paper/bank/accounting trail for your profits and expenses.

Are you saying sign up for stripe atlas?

Re: Ask HN: At what point did you incorporate for your startup or side project?

#57

Post by s0rin »

nish1500 wrote: post #19

I haven't incorporated and don't intend to. I don't need limited liability, and I am not working with companies that require me to incorporate. Incorporation would mean a ton of paper work, more taxes (in Canada at least), more complications, and 3x the accountant's fees. For what it's worth, my project nets 200k, is 3 year-old, and I have a degree in accounting and taxation.

Is your project based around financial/accounting technology?
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