What is better to register - Limited Liability or Individual Entrepreneur
Let us examine the main differences of one form of organization from another.
Responsibility for its obligations
Ltd. is responsible for the debts of the property of the company and share capital And SP - with all his personal property, including apartment, car, cash. If necessary, an LLC can be reissued to another person; it cannot be done from the IP
When registering, an entrepreneur needs only a passport and payment of state duty in the amount of 800 rubles. An entrepreneur can work without a printing and checking account anywhere in the country, but be registered with the Federal Tax Service only at the place of residence. The exception is UTII. This activity must be registered at the place of business.Ltd. is registered at the location (legal address) and for this you need to prepare a whole package of documents, attracting hired professionals. State duty for registration is 4000 rubles. It is obligatory to pay in the authorized capital - at least 10,000 rubles. An LLC may consist of up to 50 founders, and an SP cannot have them. Therefore, entrepreneurship is not suitable for conducting collective business. The PI itself runs its business or its representative under a notarized power of attorney, and the founders of an LLC designate a director who represents the organization without a power of attorney.
For LLC, accounting is required, except for the USN. From 2013, this will apply to all tax systems. It is difficult to keep records of LLC itself and requires the involvement of an experienced accountant. Entrepreneurs are exempt from accounting. It is only necessary to fill out the book of accounting of income and expenses, in order to calculate taxes.
When committing tax and administrative violations, the fines applied to the LLC are several times higher than for the entrepreneur. For example,violation of the procedure for conducting cash transactions threatens individual entrepreneurs with a fine of up to 5 thousand rubles, and an LLC - up to 30 thousand rubles. In addition to the recovery from the company, the recovery from the manager is also applied.
Taxes FE and LLC
When applying the simplified taxation system for individual entrepreneurs there are no restrictions on the income and cost of fixed assets. Legal entities can apply the simplified taxation system if their annual income does not exceed 60 million rubles, the number is no more than 100 people, and the residual value of fixed assets is less than 100 million rubles. When applying the generally accepted system of taxation in terms of the formation of taxes in the framework of economic activity, individual entrepreneurs pay VAT and personal income tax, while limited liability companies pay VAT and income tax. An individual entrepreneur without wage earners pays only a tax on income from his business activities and insurance premiums in the amount determined on the basis of the cost of the insurance year to the Pension Fund and the MIFF from the minimum wage adopted by law. Ltd. can not operate without workers. And in addition to taxes on income received, it pays insurance premiums to extra-budgetary funds (PFR, FFOMS, FSS) on the amount of the accrued wages, which must be higher than the minimum wage.PI and LLC since 2012 are required to keep records of cash transactions. But at the same time, entrepreneurs can take all the proceeds, cash and non-cash, without any report. And organizations can not do this, because it is the income of the company, and they can be spent only on the necessary needs.
Closing of SP and LLC
The closure of IP, as well as registration, is quick and inexpensive. The entrepreneur submits an application for liquidation and a receipt for payment of the state duty (160 rubles) and after a week receives a decision on exclusion from the EGRIP. Liquidation LLC takes at least 3 months. The process is very long and costly. It is necessary to submit an ad to a special journal, pay off creditors, pay severance pay to employees, hand over interim and liquidation balance sheets.
Entrepreneurs are prohibited from producing and selling alcohol, in contrast to organizations. In addition, the organization is considered more solid than the entrepreneur. And large firms are more willing to work with them than with individual entrepreneurs, although this is not justified. PI is simpler and more profitable in terms of accounting, taxes and reporting.
In conclusion, I would like to note that the choice of the legal form for a business still depends on the objectives, scale and prospects for its development.For small businesses, it is preferable for individual entrepreneurs, whereas for a growing and promising area, LLC is better. The choice of IP or LLC is yours!
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