You are a micro, small and medium-sized business owner who wants to register a company, but you are confused about which type of company to choose. You've heard of one-person companies and sole proprietorships, but you still can't figure out the difference between them, and you can't figure out what the advantages and disadvantages of each are. You're confused, and you don't know what to do. So today, I will uncover the mystery for you, explain the difference between a one-person company and a sole proprietorship, and help you see more clearly and make a wise choice.
First of all, we have to understand the definition of a one-person company and a sole proprietorship. A one-person company refers to a limited liability company with only one natural person or legal person shareholder, with legal personality, and the shareholders have limited liability for the company's debts only to the extent of their capital contributions. A sole proprietorship is an operating unit invested by a natural person, the assets are owned by the investor alone, and the investor bears full responsibility for the debts of the enterprise with his personal property, and does not have legal personality.
Roughly the following points:
1.Tax policies vary. A one-person company needs to pay value-added tax, enterprise income tax and shareholders' dividend tax, and the tax burden is relatively large. Sole proprietorship enterprises do not need to pay enterprise income tax, only need to pay value-added tax and personal production and operation income tax, and the tax burden is much smaller. Moreover, sole proprietorship enterprises can also apply for verification and collection, so as to reduce the cost of taxes and fees.
2.Taking responsibility is a far cry. The shareholders of a one-person company are liable only to the extent of their capital contributions, but if it cannot be proved that the company's property is independent of their personal property, they must be jointly and severally liable for the company's debts. Investors in sole proprietorship enterprises need to bear full responsibility for the debts of the enterprise with their personal property, which is naturally risky.
After reading it, what type of company do you think is more suitable for you? Do you have any other questions or ideas?
That's all for this article, if you still have questions, welcome to send a private message or leave a message!
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