07/10/2022
5 Differences Between CAC Business Name Registraton and Limited Liability Company Registration
So I get many people ask me this question :
What category of business registraton is ideal for me ?
Is it Business name (BN) or Limited Liability Company (LTD) ?
Why should I go for Business name or Limited. ?
In this post , I am going to give you 5 differences between the two above mentioned Category and then you can decide which is ideal for you.
So here they are ;
1. For business name, the Owner of the business has unlimited liability and can be held personal liable for the debt of the company , whereas , for LTD , shareholders have limited liability and are not personally held responsible for the debt of the company.
2. It could be more difficult to raise capital for Business Name. You know, for LTD, shares can be used as collateral for loan or in exchange for equity investment so it's easier to raise funds
3. You can easily transfer the Ownership of a Limited Liability Company but for business name, once the owner of the business dies, the business is likely to come to come to an end.
4. Business name registraton is less complicated than that of the Limited Company and also cheaper too
5. You operate a Limited Liability Company in a more formal way than that of a business name. For instance, you need to organize Annual general meeting and Important decision need a board meeting and resolution
Now it's up to you to decide, which of the Category will you like to go for.
While you decide please note that not all business can be Registered as a Business name but Most Business will pass for Limited Liability Company
Have any question ? let me know in the comment section.