Objectives and Commitment

The decision as to what type of group should be formed should be based on amongst other factors on the objectives of the group and commitment of members and not solely on tax.

A simple decision flow diagram can assist greatly in determining the group structure.

If there is no common objective there is simply no point in forming any type of group.

If the commitment of members to each other is low then consider an expense share arrangement.

When commitment is high it then comes down to whether each member can commit the same amount of time and funding. If this is the same then a partnership should be considered. When there are differences then a limited company maybe considered as the shareholding may accommodate better the different levels and types of commitment.

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