Kennedy Hualupmomi
What's the difference between a company name and a business name?
Company ends with the word LIMITED. Meaning, you can operate two and more different company activities under that single company name you register. If you register Johnny Limited then you can operate more different activities under that company name Johnny Limited. For example, under Johnny Limited, you can operate construction work, trading or retail work, pmv service, hire car service, rental service and the list goes on.
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| What is the Difference Between a Company Name and a Business Name? |
Only a company have shareholders, and can have 1 or more directors and 1 or more shareholders.
However, under the business name you cannot operate more than one activity or apart from the activity in relation to the description of the business. Your busines must consist at the end of the business name the concise description of the nature of your business activity. For instance, if you intend to operate a trade store. Then you must register a business name as- Johnny Trading or Johnny Retail or Johnny Trade Store. With that business name you must operate activity relating to TRADING only like retails. Another example, if you register your business as Johnny Construction- you must operate construction work only under that business name. You are not allowed to operate hire car service or any other different activities under your Johnny Construction business name. A business name can have a sole owner or les than 5 owners.
Taxation Side of It;
Company has a tax advantage than a business name. A business name is taxed on individuals who owns the business as personal income tax which can go up to over 40%. Whilst the company is taxed at 30% and the individuals are not taxed, the company name itself is taxed.
Company is a legal entity whereas business name is a registered business activity only. A business name is just a registered name to whom it belongs to and meets the requirements of IPA to trade under but the all legality lies with the principal owner of the business therefore the business name is not a legal entity.
Companies are legal entities. They can be sued or be sued under their own names but that is not the case for business names. For business names, the person owning the business name can be sued or be sued if not complying with the laws in place for taxation and other related laws for operational purposes.
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