This is Daon Management Support Group, which helps businesses escape the burden of taxes.
Today, we will learn about what methods can be used to convert to a private corporation and tell you about the benefits of switching.
- What is the conversion of private corporations?
It refers to the establishment and conversion of obligations for management and responsibility by a business operator that is burdened by a large amount of tax while starting and operating as an individual business operator.
If you switch, you can receive various tax benefits and use the government's various support systems, so if you are a private business operator who wants to save taxes, consider it carefully. You can efficiently reduce taxes by using various measures, so please find an expert and get help.
- When would be a good time to switch to a private corporation?
If the amount of income increased by maintaining private businesses exceeds 70 million won based on annual sales, it may be a good idea to consider conversion. There is a section where the income tax rate is applied, because this is a more advantageous section when applying the corporate tax rate.
If you have already become a person subject to a sincere report due to your increased income, it can be a burden with a lot of taxes, so it is recommended to switch to a private corporation immediately. If real estate is starting to increase and you are worried about spending on transfer taxes, it may be better to choose a conversion.
- How to convert to an individual corporation
a. In-kind investment
It is a method of investing assets such as real estate, securities, and bonds obtained by maintaining individual businesses into a newly established corporation after being evaluated by an external evaluation agency.
It's an advantageous method when you want to establish a business that's much larger than the existing one. It is easy to misappropriate funds because you do not have to have separate capital when establishing a new corporation. However, because you need to undergo an external evaluation, you may incur costs for the evaluation and the process is complicated, so you often don't choose it.변호사마케팅
b. Comprehensive transfer
It is a method of transferring and transferring real estate and profits, debts, employees, taxes, etc. that you earned when you maintained your personal business. If your existing business is large and you have a lot of sales, it may be an advantageous method.
It can benefit from the transfer income tax and employment tax on the assets of individual businesses, and it can be an appropriate method for businesses in situations where contracts need to be made quickly because it is carried out through a short process.
Although it has the advantage of being able to handle everything without missing anything because even the business and contracts that were maintaining progress can be inherited, some people are worried about the burden of having basic capital and incurring costs for conversion.
c. New establishment after simple closure
It is a method of establishing a new corporate company after closing a private company. Although it is not an easy choice because of the disadvantages of long-term conversion and high cost for investment, some people use this method to think that it may be beneficial to have a low tax rate after switching to a corporation.
- Should I switch to a private corporation?
Although individual businesses have the great advantage of being able to use their income freely, many people want to switch to corporate businesses due to the high rate of income tax. As income increases, the tax rate increases, so more and more people are worried about paying taxes.
Of course, being a corporation doesn't only have advantages. Funds are not freely available, stocks, property, etc. can be difficult to dispose of for five years, and closure is not easy.
However, since accounting can be transparent and financing can be made easier by increasing external creditworthiness, if you want to increase the size of your business, don't worry about switching to a corporate operator.
If you visit the Daon Management Support Group, you can make a transition through a legal method, so please visit and have a good conversation. The choice is up to the CEO, but many of the know-how accumulated through experience can be delivered, so please get an interview.
Let's think together about how the current state of the enterprise can make the most profitable operations possible. There are many cases where it is beneficial to keep your personal business intact, so get a diagnosis first.