Here are some of the common reasons that people have for buying a shelf company.
1. Time constraints: now you might require a company. This would be the case when you want to apply for a tender and the client will just purchase from a legit company.
2. Aged company: You may simply require an old registration-number and it will look like you have been there for a while. Aged company is like a bottle of old wine, the rates escalate drastically with age.
3. Specific company requirements: you may require a corporation with a specific registration like Importer/Exporter and VAT. A few shelf corporation suppliers assure fast registration, however, what they don’t mention is that they cannot apply until you’ve fulfilled all the needs. When it comes to VAT, it will take approximately 3 or more weeks for compliance.
One thing you need to consider while buying shelf companies is that there are several shelf corps for sale that have already conducted business, avoid buying such a company. In case you purchase such a company then you will become liable to pay all the liabilities of that company. So, in case the corporation has had any court cases against the company from the previous clients then you will become liable as now you are the owner of the company. Also, it is very significant that the shelf company you are planning to purchase not have any lingering or inherent liabilities. This can be guaranteed by seeking the company’s history and making sure that the range of its business performances was nonexistent or limited excepting the application of an EIN and maybe the bank account opening.
However, there is a risk while buying shelf companies. The jeopardy is that you could buy many other problems when you choose one of the shelf corps for sale. If the company is doing business, you could find yourself taking on debt or taxes that the company earns. Besides having a clean background, the shelf company should have kept a record on government company filings, if needed, and should have registered tax returns annually, even though there are zero amounts on the returns.
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