It is not solved simply by using a corporate vehicle. A company must still have two directors. If a business involves substantial risk then it might be better to operate as a sole proprietor and confine the risk to one person. If the business was conducted by the client as a sole proprietor then only his interest in the assets would be put at risk. Finally it is imperative that clients understand the structure put in place for them.
Most people have a basic idea of what a company is but really no idea of what a trust is.
The tax disadvantages of a company may be not so great as to run the risk that a trust structure is simply not conducted properly. This can lead not only to taxation compliance problems but also to internal family conflict over who is entitled to the assets of a trust. The Law Society of New South Wales is the professional association for the solicitors branch of the legal profession in the State of New South Wales, Australia. 170 Phillip Street, Sydney NSW 2000, Australia.