One of the first decisions any founder faces is which legal structure to register with the Corporate Affairs Commission (CAC): a Business Name, or a Private Company Limited by Shares. The right choice depends on how you plan to run and grow the business, not just which is quicker to set up.
Business Name
A Business Name is a simpler registration, often suited to sole proprietors, freelancers, and small owner-run businesses. It does not create a separate legal identity from its owner, which means the owner is personally liable for the business’s debts and obligations.
Limited Liability Company
A private company limited by shares creates a separate legal entity from its shareholders. This generally limits personal liability to the value of shares held, and is usually the better fit if you plan to bring in co-founders, raise investment, or enter larger commercial contracts.
Which One Fits You?
- Running the business alone with modest, predictable operations? A Business Name may suffice.
- Planning to bring in partners, investors, or scale significantly? A company structure is usually worth the extra setup.
- Entering a regulated industry or bidding for larger contracts? Many counterparties expect a registered company.
There is no one-size-fits-all answer, the right structure depends on your specific plans. If you’re unsure which fits your situation, we’re happy to talk it through.