If you currently own and operate a small business in the United States of America, it is important to know all of the applicable financial laws. Once you are aware of these laws, you can determine the steps you need to take, if any, to make your business compliant. Finance law applicable to small business owners include:
- Bankruptcy. Unfortunately, not all small businesses can survive. Business owners that can’t pay back their creditors can choose to declare bankruptcy to prevent legal action and settle debt. Determining how much a creditor can collect is based on the type of business you own. For example, corporations, limited liability companies and some partnerships will protect personal assets from being collected as payment. If you are the sole proprietor of a business, you may have to use personal assets to pay off debt.
- Anti-trust. Anti-trust laws are there to protect consumers from fixed prices or prearranged bids. This finance law promotes competition and prevents anti-competition.
- Securities law. Enforced by the US Securities and Exchange Commission (SEC), businesses must report their finances according to the law. Applicable forms that need to be filled out can be found here.
If you are uncertain if your business complies with American finance law, call the Winflow Financial Group at 1.800.956.6897.
A common exit strategy to leaving a small business is simply closing the business down. If you have decided to close your business, there are various bureaucratic measures to take. Some of the things to remember when closing down a business includes:
- Voluntarily dissolve the corporation. This can be done through a resolution passed at shareholder’s meeting or through the personal representatives of the business at that time.
- If it applies, cancelling your business registration, partnership or sole proprietorship can replace dissolving a corporation.
- Close all of your payroll accounts with the Canada Revenue Agency (CRA).
- If you have dissolved your corporation, file a last tax return.
- Close your GST and HST accounts with the CRA.
- Close your PST/QST/RST accounts with the CRA.
Failure to properly shut down or dissolve a business could result in tax complications. Ensuring you have followed all of the above rules is necessary when choosing this exit strategy. T0 learn more about closing down a business, visit this government of Canada page.
If you are interested in selling your business to someone else, read this article on succession planning. To learn more about exit strategies and closing a business, contact the Winflow Financial Group. Our trained consultants can help you through all of the necessary steps involved in closing a business.