Procedures To Open A Business

Procedures To Open A Business

All the entrepreneurs They face many challenges when starting their business.

But probably one of the main ones consists of give legal form to the company that are about to open because in many cases this legal structure contributes to the success or failure of the business.

Usually everything future businessman You are usually aware that when you open your business you will have obligations with various state regulatory entities such as the Treasury or Social Security and therefore, you know that there are various procedures which are mandatory for the formation and normal operation of a commercial company.

That is why in this post we leave you a guide so that you know where to start and what those are minimal paperwork with which you need to meet for turn your business into a business with all the law.

Of course, it should be clarified that the procedures may vary in each city, in most of them you must comply with state, federal and municipal obligations depending on the type of business you want to register.

General Procedures

Regularly all businesses, whatever their nature, must comply with certain procedures, namely:

Registration in the Tax or Finance Registry

  • Declaration prior to the start of operations
  • Register for the Economic Activities Tax (IAE)
  • Register in the VAT and Income Tax regime

Registration in the Commercial Registry

To get started you need to determine what your company’s operating model will be, which can basically be started in two ways:

  1. Individually: constituting a commercial company owned by a single person
  2. Collectively or in partnership: which in turn is divided into two:
  • Establish a jointly owned company, that is to say that there are several joint owners.
  • Establish a commercial company

Requirements to Incorporate a Commercial Company

  • Registration forms
  • Copy of the owner’s identity document
  • Accounting certification authorized by a certified accountant

Requirements to Incorporate a Public Limited Company

This constitution process is done through an authorized notary.

  • Preparation of the articles of incorporation
  • Preparation of minutes of appointment of legal representative
  • Company patent management
  • Patent management of the commercial register
  • Deposit the equivalent of the initial capital

Enrollment in Social Security

This enrollment allows you to build a roster of employees and comply with the rights and obligations regarding insurance coverage that the state grants them.

  • Registration of the employer in the Regime of Self-Employed Workers
  • Registration of the company in the SS
  • Register employees

Procedures to Open a Business in Mexico

In Mexico, the paperwork to open a new company has improved significantly. Although in past years it was very complicated and bureaucratic, governments in recent years have made significant efforts to modernize the business registry.

According to Doing Business, a World Bank organization that analyzes processes in 189 countries, in Mexico the average time to open a business is around 6.3 days (2016 data).

According to Forbes magazine, these are the 5 basic procedures you must complete to open your business in Mexico:

1. Land Use Permit

Land Use in the states of the country is processed in the municipal capitals and in the case of the Federal District, it is carried out at the single window of each delegation or at the offices of the Ministry of Urban Development. The process lasts 5 business days and the permit is valid for two years and is easily renewable.

2. Notice of Declaration of Opening of Commercial Establishments

This is a free procedure and is done at the one-stop shop of the delegations or at the municipal seats. In the case of the Federal District and some states, it can also be done through the Internet through the page . It is a one-day procedure.

3. Operating Licenses

Businesses that do not sell alcohol and are not classified as high impact do not require an Operating License. This is for businesses that sell alcoholic beverages, such as restaurants, bars, and the like.

There are two types of license: type A for restaurants and hotels, and type B for bars and clubs. The costs of licenses vary by state and are valid for three years, but can be easily renewed.

4.Authorization for Exterior Advertisement

This, like the previous procedures, is carried out at the single window of each delegation or at the municipal seats. The cost and time to authorize varies in each state, according to the size and type of ad. In some places luminous advertisements are not allowed and in some cities there are advertisements that have restrictions according to their content.

5. Registration in the Federal Taxpayers Registry

You must also register with the Ministry of Finance and Public Credit, under the regime that best suits your business, for this, you can consult an accountant.

In case of being a legal person, the Mercantile Society must first be registered with the Ministry of Economy. And this can be done up to a month after opening your business.

Procedures to Open a Business in Colombia

Colombia is another country that has had very great and significant progress in terms of what company registration it means.

The entities involved in the process are DIAN, the Chamber of Commerce and a bank. A large number of companies that are incorporated in Colombia are SAS (Simplified Stock Companies).

According to a study carried out by Revista M, these are the 10 basic steps to open a business in Colombia:

  1. Check that your company name is commercially available
  2. Prepare, write and sign the bylaws of the company. These are the contract that will regulate the relationship between the partners; and between them and society (SAS model)
  3. PRE-RUT. In the Chamber of Commerce, you can process the PRE-RUT before proceeding to the registration.
  4. Registration in the Registry. In the Chamber of Commerce they will carry out a study of the legality of the statutes; you must cancel the registration tax.
  5. You must proceed to open a bank account.
  6. You must process the final RUT at the DIAN.
  7. Bring the final RUT provided by the DIAN to the Chamber of Commerce so that in the Certificate of existence and legal representation of the company, it no longer appears as provisional.
  8. In the DIAN, the billing resolution must be processed, in principle manual for issuing invoices.
  9. You must request the Registration of Minute Books and shareholders at the Chamber of Commerce.
  10. The company must be registered in the Social Security system in order to hire employees.

See also: 14 Profitable Businesses in Colombia

Advantages of Legalizing your Business

  • Facilitates access to credit and financing through the banking system or the government
  • Operating in order provides more confidence and security to your clients
  • Growth opportunities are increased as you attract more formal business
  • You have rights to which you can access in case they are threatened

As you can see, most are very simple and fast procedures, which will allow you start your business operations quickly and smoothly.

Take into account that this post deals with procedures for the establishment of commercial companies. If what you are thinking has to do with the industrial sector or factories, then they are other requirements that we will talk about in another post.

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