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Deed of incorporation of a sole proprietorship: everything you need to know

A memorandum of association of a sole proprietorship is an important document required to start a business. It is a legal document which records the formation of the sole proprietorship, including information about the owner, business activities and other relevant details.

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A sole proprietorship is established by one person who is responsible for all decisions and financial obligations of the company. Setting up a sole proprietorship requires drawing up a memorandum of association obliged. In this deed all important data of the entrepreneur and the sole proprietorship are recorded.

The memorandum of association must be prepared by a notary and contains, among other things, the name of the sole proprietorship, the purpose of the company, the address of the business location and the details of the founder. The powers of the founder and any other important clauses in the deed included. The memorandum of association is then enrolled in it Business Register of the Chamber of Commerce.

Setting up a sole proprietorship through a memorandum of association entails costs. These costs depend on the notary that the deed and may differ per notary office. It is wise to do this before drawing up the deed request a quote from various notary offices in order to find the best price-quality ratio.

After drawing up and registering the memorandum of association the entrepreneur can start carrying out his activities under the name of the sole proprietorship. It is important to understand all obligations arising from the memorandum of association obligations, such as keeping records, paying taxes and complying with any provisions of the deed.

A sole proprietorship has the advantage that the entrepreneur can make all decisions himself and keep the profits entirely for himself. On the other hand, the entrepreneur is also personally liable for any debts of the sole proprietorship, which entails a risk. It is therefore wise to carefully consider in advance whether a sole proprietorship is the right legal form for the company.

It is possible to dissolve a sole proprietorship by drawing up a deed of dissolution. In this deed all current affairs of the sole proprietorship are resolved and the business is formally terminated. After dissolving the sole proprietorship, the entrepreneur must pay off any debts and arrange tax matters.

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