Critically Discuss key International Differences in Ownership Structure of Firms Around the World

BUSINESS OWNERSHIP STRUCTURES
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Business Ownership Structures
International Differences in Global Business Ownership Structures
The decision to start a business involves many choices, and among them is the type of legal structure that will form the enterprise. The selection of the structure will have a significant influence on the total taxes to be paid by the business, the amount of paperwork involved in setting up the business, personal liability and one’s ability to raise the required capital. Decisions made requires a full analysis, and not based on assumptions (ENTREPRENEUR, 2016). Consulting business experts pay a lot to have an overview of the different structures of successful working models. The conventional business structures include sole proprietorship, partnership, corporations, and limited liability companies among others. The implications of the choice of a business structure vary from the legal liabilities, tax implications, starting and administrative costs, and the flexibility of the enterprise to changes in the markets and, the business should consider the needs of the future (Queen Mary University of London, 2014). Different countries have diverse requirements that have been set for one to register a particular business structure. The essay discusses the differences that exist in business ownership structures globally, with the case studies being Brazil and the United Kingdom.
Sole Proprietorship
The most common and simplest business structure, it is an unincorporated type of business whereby it is owned and managed by one person, with no distinction between the owner and the
Business. The owner enjoys to all the profits and losses in case of occurrence. It is a disadvantageous type of structure due to its dependence on the proprietor to exist (ENTREPRENEUR, 2016).
Sole Traders in the United Kingdom
The category forms the majority of the types of businesses, with at least twenty percent of the sole traders working in the construction industry, another twenty percent in the retailing sector, ten percent in finance and another ten percent in the catering business. People prefer this type of business due to the simplicity in starting and paperwork involved. Before registering as a sole trader, one has to register first as a self-employed with HMRC to avoid fines of up to a hundred percent in taxes. The taxes are paid based on the profits made by the business. Those operating as sole traders are required to pay a flat rate insurance contribution as stipulated on class 2. Annual earnings exceeding 8,060 pounds are required to pay taxes based on class 4 rates. The sole trader submits employee’s taxes to the HMRC. Also, no registration fees charged to start a sole proprietorship (Gov.UK, 2016).
Sole Traders in Brazil
The wealth and assets of the person and the sole proprietorship are the same, making the business owner personally responsible for the firm’s debts. Starting a sole proprietorship business involves registration within the board of trade based on the primary activities of the enterprise. Also, registration with the internal revenue service, the secretary of the state treasury and the local gove...