The launch of an online store is associated with the question “What is better for trading on the Internet: LLC or individual entrepreneur (IE?”). Each of the organizational and legal forms has advantages and disadvantages. Your business needs and worth are things that will determine the type of legal business structure to opt for during that period.

Each type of entrepreneurship has its own positive and weak sides, which can be associated with both the registration procedure and the further conduct of the business. In medium and small companies, they usually use the form of LLC or IE. The main difference between these two legal forms is in the terms of the contract between the state and the entrepreneur.

For online stores, deciding on the right type of legal business structure might be difficult. Both IE and LLC have their sets of advantages and disadvantages.  An IE business structure is quite simple to register for online businesses, especially startups, because less documentation is required for the whole process.

Which is Better?

So, what form of business registration is more convenient for opening an online store? As an answer to this question, there are different opinions, but many experts believe that it is preferable to start with an individual entrepreneur since there is a simpler workflow and there is no difficulty in accounting. At the same time, in the case of an individual entrepreneur, the withdrawal of income will be much cheaper and more comfortable compared to an LLC. This is an option for those who want to see if the business will go or not.

As a rule, online store owners open their business as an individual entrepreneur on a simplified tax system. Usually, such work does not require renting an office and hiring a large staff. To open an online store in the form of an individual entrepreneur, you will need to open a current account for more convenient work with clients. Registration of the online store is carried out at the place of residence without a lawyer’s assistance.

If an online store is founded by several people at once, then LLC is the best option. At the same time, you can work without an office with a legal address. Before registering an enterprise, it is advisable to consider all the pros and cons of an LLC and an individual entrepreneur. When registering a business through an LLC, you need to attract a qualified lawyer who should help in drawing up the memorandum of association, charter, and other documents. You also need to be prepared for additional tax costs.