There are so many things to think about and choices to make going into private practice. The first big decision is choosing a business structure, and many small business websites do a great job at educating their readers about this. Let me tell you what I’ve learned so far.
I have spoken to a number of counsellors who are in private practice. Some chose to work within a sole proprietorship because they anticipated small revenues and/or wanted to keep it simple. Others decided to incorporate because it seemed like the logical and/or safer route to follow. I have also done some online reading about limited liability partnerships wherein practitioners work somewhat independently of one another and commit to sharing expenses.
I am also taking some entrepreneurial classes through a Continuing Education program and I am loving it. What I’ve learned in this class is that there are advantages and disadvantages to each business structure. A sole proprietorship costs less (approximately $50.00) and is easier for tax purposes. The incorporation, on the other hand, provides more personal protection from legal issues and the cost is about $460.00. Basically, if someone sues me as a sole proprietor, (s)he can pursue my business and personal assets whereas that same person can only access my business assets if I am incorporated. This was the deciding factor for me.
My choice may be different than yours for a variety of reasons. It would be great to hear from other counsellors in private practice and how you made this decision. In fact, if at least two counsellors post to this blog, that will double the number of posts from last time!
*The views expressed by our authors are personal opinions and do not necessarily reflect the views of the CCPA