Sole Proprietorship
A sole proprietorship also known as a sole trader and is owned by a single person.
The sole trader operates as an individual and takes all the risks and benefits arising from the business. The business is considered as a separate entity and the owner is responsible for the debts and obligations of the business.
Even though, business is a legal entity the business finances are not easily separated from the personal finances of the owner. The business has to be name a nd be registered with the Companies Commission Of Country. This form of business does not enjoy limited liability, that is if the business is unable to pay debts the creditors can make claim against the owenr who has to settle the business debts from his personal assets.
Sole Proprietor are small businessess. Many professional set up their own practice as sole trader; even operating from their own premises and survive from a small client base.
Advantages
The main advantages of sole proprietorship are easiness to move up, relatively less regularization, high manipulate over the activity, wanton to end. Another asset is that one takes all the profits of the line. This is the water justification that most businesses are of this type. A flatfish proprietorship is not a corp; it does not pay joint taxes, but kinda the someone who configured the activity pays ego business taxes on the profits prefab, making business much simpler. A unshared ownership also does not bang to be obsessed with double levy, as a joint entity would. A sole trader doesn’t have any opposition when taking a decision as he has total control.
Disadvantages
As A sole trader, every financial aid/funding are beared by the itself. He/she have to handle the crucial part. Most business many failed on their business in the earlier stage, reasons not being able to boost the financial funding for their business.
Another disadvantage of a sole proprietorship is that as a business becomes successful, the risks accompanying the business tend to grow. To minimize those risks, a sole proprietor has the option of forming a corporation, or, more recently, a Limited Liability Company.