15

An LLC protects you from personally from all creditors, whether they be customers, shareholders, or other parties. Liability for business activities is limited to the LLC's assets; yours are protected. Nolo's LLC Basics describes this well: Like shareholders of a corporation, all LLC owners are protected from personal liability for business debts and ...


10

It should be remembered that with any form of Limited Liability structure (LLC, Ltd, PLC) etc the liability is limited only to the shareholders or members. In the event of a company failing, other than losing their investment, shareholders/members are only liable for any unpaid share purchase money (or nil, if all shares are fully paid up). Beyond that, ...


6

LLC disadvantages vs. sole proprietorship: Government fees to establish and maintain the LLC (usually $100-$500 first year and up to $100 subsequent years, depending on your state). Paperwork to to establish and maintain the LLC. However, in some states, this is nearly zero - just a few minutes of filling out government web forms. That's it. Taxes are the ...


5

There are a few disadvantages to incorporating as an LLC as opposed to going forward as a sole proprietor. More paperwork. Basically, since you'll be an actual company, you'd need to file paperwork with the state. This may differ state to state (since you mentioned the United States). Taxes. Depending on the state, you may need to pay self-employment taxes ...


4

The rules in (and therefore the required answer for) Canada are probably different from the UK, but this answer gives my experience from a UK perspective, and will hopefully be of help. Obviously, you will be becoming an employee of another company - but there is nothing to stop you remaining an employee of your own company too. In the UK, payroll taxes ...


4

Why don't you hire him instead of "showing" him your clients and connecting him to them? This way you can earn a bit from his work. And of course, suffer negative consequences in case of troubles. This seems like a lot of work and questions for all good things you will provide to your colleague: start his business, get a client immediately, gain reputation,...


4

Edward Brey's comment is pretty much spot as far as liability is concerned. Other than (well put, Edward!) illegal activity, the LLC form protects the owners and operators from incurring personal liability as a result of activities carried out for the business of the LLC. The LLC business entity is a simpler approach than a corporation because it removes ...


3

I find this question really difficult to answer because it's really a 'yes' and a 'no'. Yes, you can get work with larger companies because often large companies and agencies will only work with companies and simply won't hire individual freelancers anymore. This is purely for tax/legal reasons as others have explained. And 'no', because the fact that you ...


3

You have the ability to get into more opportunities when your business is registered as a corp or LLC, because it removes a threat of liability (for paying statutory employees under-the-table) for the customer. However, nobody's going to beat a path to your door other than the recruiters. If your credentials are solid and in a "hot" field, your phone will ...


3

Having freelanced in a number of countries, this is actually a fairly common requirement. If you interpret 'freelance' as "running a business", it's even understandable. Compare the realities of a business and an employee. A business gets to deduct most of its expenses before calculating its taxes, whereas an individual pays their expenses from post-tax ...


3

I think it's valuable to add to the other answers that you must be able to prove that your LLC is acting as a business entity in order to have the protection specified. Generally speaking you do this by running it as a real business and not as a shield. (Meaning that, in most cases, you can not simply have an LLC but give it no capital, keep no books, etc......


2

As the contributions are paid on your self-employed income (if any) from a corporation I was wondering why would you have to pay them? No self-employed income - no contributions. You'd still have to file payroll forms/reporting though for the corporation. Your full-time employer will deduct and pay CPP/EI contributions on your salaried income. Disclaimer: ...


2

Firing yourself just means suspending/cancelling your payroll account, which is a simple phone call. A corporation is a little bit expensive (bank fees + annual report filing cost), but not as expensive as making a new one if your situation changes in less than 7-8 years.


2

Working as an individual, you won't have the resources to build a website for a major corporation. No matter how good you are, you can only work so fast by yourself, and they don't want to wait years for you to deliver a website that takes 10,000 man-hours or more. Additionally, you are trying to climb a mile-high cliff with a stepstool. You can't jump ...


2

UK IT contractor here... You have 3 options: Go Limited Go umbrella FTCs Going Limited has its perks. You take a cut of the VAT as profit, can offset expenses at source, minimal overheads. However, you will need an accountant for your annual returns (personal and company) and that can be expensive. If your income before taxes is less than £40k, this is ...


1

Yes, it should. If you are not incorporated, then the company that is hiring you as an independent contractor can subsequently end up being sued for misclassifying their employees as independent contractors, resulting in all sorts of legal uncertainty if it were to happen on a sufficiently large scale, plus might end up having to cover your self-employment ...


1

You might find this useful. https://www.incorporate.com/how_to_incorporate_yourself.html Personally, I would avoid being salaried in any way, and work on an invoice basis. This enables you to remain 'the boss' in where and how and when you work, and to make some decent money. The ideal is to be able to charge thousands of pounds for a day or twos work. ...


1

No, there are no additional doors opened by owning and/or working under an LLC or corp. There is no benefit to the client if you are an LLC or corp because you are still a person and you are performing the work personally. For instance, marketing yourself as the owner, CEO, or whatever of your single-member LLC or sole proprietor corp is quite silly unless ...


1

I cannot answer question 1, I guess they have some obligation from the Labour law, which is complicated in France. For question 2, in France, there are some intermediary companies for consultants (search for "portage salarial"): you charge the client as if you were a company, the client pays to your intermediary company, and you get a salary from the ...


1

When it comes to those huge companies you mentioned they usually approach big web design/web dev companies, not individual developers. It is very difficult for a freelancer to land a job from one of these gigants, ex. McDonalds, but that doesnt't mean it's impossible. Apart from all the standard stuff (awesome portfolio, skillset etc.) it's probably ...


1

The first step is to start with time tracking. I would recommend ManicTime which has a variety of tools to manage and report on your time. http://www.manictime.com/ You will then need to use any of a large variety of accounting software to apply Canadian payroll and income tax regulations. This can be done in Excel or a custom application like Quickbooks. ...


1

The main advantage of forming an LLC vs. a sole proprietorship or partnership is the greatly diminished risk to your personal finances. By forming an LLC, you shift responsibility for your business debts and liabilities from yourself to the newly formed corporate entity (thus, "Limited Liability Company"). So, generally speaking, if someone successfully sues ...


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