Business structuring
Business structuring is an activity aimed at optimization of tax burden and reduction of legal entity’s expenses by legal means. It implies performance of not only one specific task, but a whole set of actions that ultimately reduce tax costs. In addition to the above-mentioned, business structuring helps to solve the following tasks:
- to increase assets security;
- to improve business processes;
- to strengthen financial stability.
Practically, business structuring involves splitting business into several commercial entities. Therefore, work functions and assets are allocated among the company’s new business units. This makes business more secure from potential losses and reduces risks. However, this does not apply for each separate division of company, but only for the enterprise as a whole. For instance, if a separate division goes bankrupt, the main enterprise has almost no risk.
Advantages of business structuring
In addition to security, there is such advantage as a more accurate and definite allocation of management functions. Due to this, the business can increase profits as well as its own commercial efficiency.
The procedure of business structuring consists of several stages. First of all, specialists shall examine the company’s business activity, its structure, reveal and review risks. This is reached through application of different financial and legal means.
The second stage implies that specialists will develop an optimal structuring model based on the obtained data. Generally it reflects the necessary business entities as well as internal and external relations. There is no universal, standard model. Experienced legal and financial consultants create a special optimization program for each company individually.
After the model is developed the third stage – implementation is carried out. Structuring is performed by creating new legal entities or by reorganizing an existing company. In the process, it is necessary not only to reallocate assets, but to conclude civil contracts for further work as well.
Thus, business structuring services help businesses to effectively solve several tasks: reduce the tax base, reduce risks, and increase profitability of the company. VALEN Group specialists will help to optimize technological and production processes, diversify assets, and correctly allocate management functions among several individuals during the structuring process. Moreover, support of our specialists will protect your business from possible unfavorable economic consequences.
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