Incorporate or Sole Prop or something else?

[Material Girl]

I think another problem that could potentially doom any restaurant is that it's hard to get long-term managers if you're only paying them a mediocre salary and they're working like 15 hours everyday.

[Galleleo]

Part of what makes a restaurant so hard to run is the time. Mostly 7 days a week, you start at 2/3pm if you only serve during the evening. Your day is done at like 2/3 am after closing up and cleaning etc. You don't get a lot of time for yourself when you run a place so you have to be really committed.

[Spider]

I wasn't just speculating, it's a fact that restaurants often fail, it's a notoriously hard business to get into. The percentage of new restaurant business that succeed is much lower than is the case in other industries. I wasn't just spouting off crap that I personally think, I don't often do that. Obviously if you make a kick ass one it will stand a good chance of succeeding.

http://www.businessweek.com/smallbiz...932_page_2.htm

This website refers to it as a myth but at least it confirms that it's a myth which exists and you didn't know.

http://www.usatoday.com/money/smallb...-success_x.htm

Same data but this person didn't refer to it as a myth. I guess it's your opinion as to how bad a 60% in the first 3 years failure rate is.

[Eric is God]

I agree with stargazer. There is something warm and snug about working for the most valuable company in Canada.

[H.M.S. Stargazer]

I'd have to disagree on the restaurant thing. Today's society THRIVES on fast food. But as being a Manager of both a corporate and grass roots business(Now and at another time respectively). I can say that If you want to have stability and low risk, go corporate.

[Material Girl]

About the bonus thing... I will never do anything without checking with my lawyer first. If it's questionable, obviously I won't risk it.

As for the restaurants, I think there's always room for a new restaurant if there's a consistently good menu. People would rather spend an extra $10 or $20 for a palatable, memorable meal than waste money on fast food. But the profit margins are generally pretty slim so unless you absolutely love it, there's not much point going there.

How is a business used as a write-off?

[404 Not Found]

I have no clue as to what the corp. law structures are in Canada, but rather than clarify the differences, this nice little chart below should answer some of the differences between LLC, C-Corps & S-Corps.

A business class can do wonders as well as I would not waste any time establishing a corp. unless you have a product or service that is in demand and will make you money!

Consider the costs of Incorporation, obtaining legal council to represent and submit a fictitious name prior to incorporating. You have tax obligations as well as accountant requirements to keep the books...you do not want to be audited! Payroll taxes, local and national corp. taxes paid by the 1/4 , 1/2 or end of year depending on fiscal spending and receiving.

Is the business to be used as a write-off?

So many variables....talk to someone in business and get some ideas, as well as possibly take a class in economic, accounting and small business. The work to start one is hard and takes a lot of time, but if you have the service or product that is in demand, what you put into it from the start can pay off big time in the end, especially if you can build it up to sell or go public.

[Spider]

I can't believe nobody asked this, but what kind of business are you going into? Sounds like you are distributing or producing something but can you get us a broad little category to satisfy some people’s curiosity?

Also, I am totally surprised you got some decent sounding information and advice. If Eric and Epi didn't happen to be trolling the forums at that exact moment every reply would have likely ended up closer to spacepimp's end of the retarded crap --- worthwhile reply spectrum. Hahaha.

Also, "I do absolutely understand that. I'd just give myself a bonus instead." sounds like you might end up like Conrad Black in, oh, about 15 minutes. That's beside the point though. What kind of business is it? As long as you aren't opening a restaurant I bet you'll be fine. I heard almost all new restaurants fail. I'd never put money into one of those pits. Who needs them, anyway, with so many Tim Hortons and SubWays?

[spacepimp]

holy shit your a dumb fuck.

[Material Girl]

Okay, so I just found out that I don't even have to choose a BOD. I can be the only BOD. Looks kinda tacky, but hey it works for me. What a relief.

[Material Girl]

I do absolutely understand that. I'd just give myself a bonus instead. Is that legal? Is it legal to make my own family the BOD? Is the actual equity split up with the BODs or what? Is it legal to put my own money in and say it's their share? Lawyers please. :wub:

And here's another interesting thing to think about:

If a woman and a man are living commonlaw, what exactly happens if they split up? Somebody told me everything goes 50/50 but I find that hard to believe. Also, if you are married without a prenup and you can prove your spouse has cheated on you, does that matter when tallying up who gets what? Just curious.

And Soul Survivor, I am doing research. I'm reading government crap that's boring as hell and sometimes I think I should marry a lawyer or something. I'm meeting with a lawyer and stuff, so don't worry - I'm not basing 100% on this thread. But I do think that there are a few very smart guys here that know about this stuff and can give me some much-needed friendly advice.

[Eric is God]

Even if you own 100% of the shares yourself, it still isn't 'yours'. For instance, if you owned a store that was a corporation, you can't just take money out of the till anytime you wanted to buy stuff... because the corporation is a separate entity from you. All money from the corporation has to flow to you via dividends or salary and appropriately taxed. As well, you can't use the corporation to buy yourself personal things which have nothing to do with the business (i.e. pay for your fishing trip if you can't show it has business value in the documentation).

That is why you are not liable for things the corporation does, because you are not the corporation.

Once you start treating the corporation as an extension of yourself, then you will be Conrad Black

It would be hers in the sense that all the business decisions would be up to her as long as she held >50% of the shares. Everything Epi said is correct though. The accounting implications of a corporation are more complicated than a personal business because you would have to withdraw profits in the form of dividends or your personal salary. As long as you understand that you can't treat it like your personal piggy bank you shouldn't have any issues.

[Epinephrine]

Why??? Where is the logic? Please enlighten me.

What's the legal maximum on how much of a percentage of the shares I can hold? Is it legal to give the others to my own family?

Even if you own 100% of the shares yourself, it still isn't 'yours'. For instance, if you owned a store that was a corporation, you can't just take money out of the till anytime you wanted to buy stuff... because the corporation is a separate entity from you. All money from the corporation has to flow to you via dividends or salary and appropriately taxed. As well, you can't use the corporation to buy yourself personal things which have nothing to do with the business (i.e. pay for your fishing trip if you can't show it has business value in the documentation).

That is why you are not liable for things the corporation does, because you are not the corporation.

Once you start treating the corporation as an extension of yourself, then you will be Conrad Black

[Soul Survivor]

You should research more. Please don't take offense to this, but if your asking for advise on a game forum it's a safe bet that you shouldn't doing anything yet. What type of business is it? Are you canadian?

[Material Girl]

Why??? Where is the logic? Please enlighten me.

What's the legal maximum on how much of a percentage of the shares I can hold? Is it legal to give the others to my own family?