The ownership structure of an enterprise is closely related to the interests of investors and the development of the enterprise. There are two common ways to hold shares in a company. One way is to invest directly as a natural person shareholder in the name of the business owner; Another way is to invest shares in the name of the company as corporate shareholders.
So what's the difference between individual shareholding and company shareholding?
I. Difference of income tax on investment dividends
1. If the shares are held by natural persons and the company needs to pay enterprise income tax, when distributing the net profit to individual shareholders, individual shareholders need to pay individual income tax, which is generally 20% of dividend income;
2. If the company holds shares, it does not need to pay enterprise income tax on dividend income when the company distributes net profit to corporate shareholders.
Second, the differences in capital adequacy obligations.
1. If a natural person holds shares, and the registered capital subscribed by the natural person fails to be paid in full when the company goes bankrupt due to poor management, the registered capital subscribed by the natural person expires in advance, and the natural person is obliged to pay off the company's debts with his personal property (that is, the part of the registered capital that has not been paid in full);
2. If the company holds shares, when the company goes bankrupt due to poor management, the natural person does not have to bear the responsibility of paying off the company's debts.
Third, the tax difference when profits are transferred to registered capital.
1. If a natural person holds shares and uses the undistributed profits of the company to increase the registered capital of the company, individual income tax shall be paid;
2. If a company holds shares and increases its registered capital with undistributed profits, it shall not pay enterprise income tax.
Fourthly, the advantages and disadvantages of individual shareholding and company shareholding are different.
1, advantages of individual shareholding
More control over the company, shareholders' own interests (voting rights, dividend rights, shareholders' own interests, etc. ) can be exercised more efficiently, directly and legally;
Tax advantage, only one tax, no enterprise income tax.
2. Disadvantages of individual shareholding
Easy to bear joint and several liability for debts, hotchpot, the company loses its independent personality;
It is difficult to take advantage of the leverage effect (the holding company controls with a small proportion of shares, and the more levels, the greater the leverage effect). Natural persons can only control the company through concerted action and holding shares on their behalf;
Equity adjustment is restricted (the holding company can transfer its equity by transferring its own equity in the holding company, which is not restricted by half consent or limited purchase right);
Can't enjoy some specific tax policies (none of the preferential policies for controlling shareholders in merger and reorganization-Caishui [2009] No.59 is aimed at natural person shareholders).
3. Public
Advantages of company holding shares
You can use the leverage of equity advantage to amplify the control of natural persons;
Better realize the adjustment in the main company (adjust the equity of the holding company and realize the equity transfer to the main company);
Tax and policy advantages (corporate income tax: the holding company receives dividends from its subsidiaries without paying corporate income tax.
4、
Disadvantages of company holding shares
High taxes and fees when natural persons quit;
The cost of holding shares is high, and the startup team can't control the huge organizational structure;
There is a problem with control (due to the huge organizational structure).
Through the comparison of the above differences and risk analysis, we can see that it is more favorable to adopt the corporate shareholders method of company shareholding. In the process of enterprise development, the company shareholding method is superior to the individual shareholding method in terms of risk issues and tax planning.
So is it definitely not desirable for individuals to hold shares?
No, individual ownership has two advantages:
First, the operation of individual shareholding is convenient and the procedures are quick;
Second, the cost is low, and individual shareholding does not involve accounting and does not need to declare taxes.
From the above advantages, it is generally suggested that it is more appropriate to choose individual shareholding when new projects are just starting or business prospects are uncertain, and it is more prudent to adjust the company's shareholding structure when the project prospects are clearer.
In addition, we should pay attention to the following points when constructing the ownership structure:
I. Protection of control rights
Protecting the right of control, the right given by law to the general partner of a limited partnership enterprise, can help the actual controller of the enterprise to invest a small amount of actual investment, and will not lose the control of the enterprise in the future equity financing process.
Second, tax financing space.
Tax financing space, build equity structure, and reserve space for shareholders' future investment, financing, transfer and dividend arrangement. If a natural person directly holds shares, once faced with investment, financing, transfer and dividends, he will immediately withhold and pay 20% of personal income tax. After the designed shareholding structure, the tax liability of dividends can be postponed to achieve the effect of tax collection.
Third, risk isolation.
By setting up a shareholding platform company to indirectly hold shares and increasing the barrier between personal/family property and operating company property, personal/family risks can be isolated more effectively.