What Is A Sole Proprietor?
Sole Proprietor – Advantages
- A sole proprietorship is easy to set up and has little formal paperwork.
- Starting this form of business can be as simple as promoting your new business by putting a sign-up announcing your new services or product.
- The business is easy to end.
- A sole proprietorship generally has fewer regulations.
- The business owner keeps all the profits and has the freedom to make all the decisions.
- Income is usually declared on the owner’s individual income tax return.
Sole Proprietor – Disadvantages
Unlimited liability (See Article ‘Limited and Unlimited Liability’ for more information).
- This means that the owner of a sole proprietorship is personally responsible for the obligations of the business, including the actions of any employee representing the business.
- The owner is 100% liable for business debts.
- Ownership of proprietorship may be difficult to transfer
- The business may have a limited life as, in most cases, the business dies or stops operating when the business owner does.
- It can be difficult to raise capital especially if the business has not been operating for long and has limited income to show.
- Most business funds come from personal savings or personal loans.
Note: The largest issue with a sole proprietorship is unlimited liability. (See Article ‘Limited and Unlimited Liability’ for more information).
WATCH our Clever VIDEO HERE
Add Your Cleverness
Make suggestions, edit, and add your Cleverness to this page in the comments or click HERE.
Clever People Love To Share
It’s FREE to share, just reference Makemeclever.com Thank you for sharing Cleverness with others.
Be part of the Clever Community
It’s easy to get FREE promotion for your site, product, or service. All you have to do is share your Cleverness with us directly at info@makemeclever.com or find out more about being part of our Clever Community – we know you’re Clever and we’d love you to be part of the Clever Community.
Main Image from Pixabay
