M.E Consulting

Companies: Its types, basics, purpose and registration benefits.

People start businesses to make money, contribute to society, create jobs, and eventually contribute to the country's GDP. Companies are usually established in stages, hence no company can be built in a single day. It takes time because it has people, stakes, and liabilities on its shoulders. Companies' businesses can be of any nature; it is not limited to a specific form of company. There are many different types of businesses in the world, but I've selected a handful to cover here:

  • Sole Proprietorship.
  • Single Member Company (SMC).
  • Private Limited Company.
  • AOP/Partnership.
  • Limited Liability Partnership (LLP).
  • Non-Profit Organization (NPO).

Sole Proprietorship:

A sole proprietorship is a business that is owned and operated by one If your firm only has one member, you must register as a sole proprietorship in order to be recognized in the marketplace by either your own name or your proposed desired name. It is a proprietorship rather than a corporation. It is a type of business in which the owner has entire control over the company, is responsible for all profits and losses, and no one has the ability to interfere with the owner's decisions. The owner is responsible for filing the company's income tax returns and paying the company's taxes. Due to the owner's limitless liability, tax rates are lower for this form of firm.

Single Member Company:

Single Member Company is abbreviated as SMC. A single member private corporation is made up of only one member and director, and it has liability-limiting benefits. The only responsibility is the capital of the owner and directors. SMC is a legal entity in its own right. That one member will gain access to the company's complete operations. SMC will be able to benefit from corporation tax benefits to a greater extent. The concept of a single-member business has aided sole owners by allowing individuals to get corporate recognition while simultaneously limiting their proprietorship liability.

Private limited company:

If your firm has more than one member, it must be registered as a private limited company in order for your desired name to be recognized in the market. A private limited company is made up of a maximum of 50 members. As a result, the shareholders, not the members, are the ones who choose the top and lower limits. A minimum of two shareholders, two directors, and a CEO are necessary for this form of business to be registered. The capital amount must be reported by the directors when the business is registered, the declared amount must be divided 50-50, and the same declared amount must be deposited from the directors' personal account to the company account.

AOP/partnerships:

AOP/partnerships are formed to operate and manage any business with a minimum of two people and a maximum of twenty. In this type of firm, partners have shared business relationships and tend to share profits. Individuals in the partnership/association must contribute capital to the business, as well as bear losses and profits depending on mutually agreed-upon parameters. The general partners pay partnership taxes in their personal tax returns, based on the proportion of their share that they agreed on. Individuals are linked partners, and as a group, they form a partnership firm.

Limited Liability Partnership (LLP):

The LLP was created to fill the gap between sole proprietorships and partnerships, as well as other small and medium businesses. Every LLP partner has their own limited liability, and each partner is not liable for the wrongdoing and forgery of other partners. It enables people to run their businesses in a more flexible, imaginative, and efficient way. A limited liability partnership (LLP) is a separate legal entity. This means that each partner's liability is limited to the amount of stock he or she owns in the LLP. An LLP's partners can appoint a Partner to be in charge of all administrative matters. If the partners do not choose someone, all partners may be required to function as a designated partner on occasion.

Non-Profit Organization (NPO):

A non-profit organization is one that is registered for the benefit of a group, the public, or the general public. A non-profit organization (NPO) is also known as a not-for-profit organization or a nonprofit institution. Any revenue that exceeds expenses for a non-profit organization must be dedicated to the organization's mission. Political groups, schools, business associations, social clubs, consumer cooperatives, and other organizations are examples of NPOs. NPOs are tax exempt by default by the government; nevertheless, some may require exemption, and only a few entities may function without applying for tax exemption.

WeBOC Registration Process for Import Export License

Import Export License WeBOC Registration is required for firms that engage in import/export or both activities. As a result, it's critical to understand the requirements and process for obtaining an import and export license in Pakistan. PRAL (Pakistan Revenue Automation Limited) under the FBR developed WeBOC (Web-Based One Custom) (Federal Board of Revenue). However, in order to launch an import-export business in Pakistan, you must first register for a WeBOC ID. The company will be unable to clear GD (Good Declaration) and will become trapped in customs procedures without a valid WeBOC ID