Business legal structure
by Imelda
(Glendale, California, US)
About a year ago I started a website with the intention of making it a full blown business. A few months later, I started a second website on a different (unrelated) subject. Now I have two websites and I am thinking of starting a third.
I'm wondering what's the best way to structure these businesses. Should I treat each website as a separate business or should I lump them all together as one business?
Do you see advantages and disadvantages to combining them? I only see the advantages, but I may be missing something. Please help.
Imelda
Answer
Hi Imelda
That is a interesting question.
When it comes to choosing the legal structure of your business there are many variables that need to be taken into account.
The topic of business structures is an involved and complex topic. Everyone's situation is different and your personal circumstances will also have an impact on the best legal structure for your business.
When starting or restructuring your business it is best to speak to an accountant as there isn't a one size fits all approach.
With regards to structuring in the organisational or accounting sense you will need to think about how each business functions.
As your sites are unrelated I am guessing that your target audience is different for each one. So your income will probably be coming from different sources. If they are purely web based businesses then most of your expense related items will be the same though.
You may follow similar marketing stategies for each site or your approach may be different for each one. To allow you to test your marketing efforts so that you know what works and what doesn't, you will need to keep separate records for each.
Choosing the legal structure of your business should be something that you do in consultation with an accountant or professional advisor. They will also be able to advise you of the best way to keep your records.
I hope this helps.
Karen (Wardle)
