• Sole tradership

    An unincorporated business entity with a single owner. The business may be under the owner’s name or a registered business name, but in either case, the owner and the business are legally inseparable.

    The advantages of sole tradership include:

    • It is cheap to set-up
    • It is simple
    • No need to rely on others (independent)

    The disadvantages (often realized when the business grows) include:

    • Unlimited liability – owner’s assets may be required to pay business debts
    • Personal tax rates = potentially higher tax
    • Illness or incapacity curtails the business
    • Death of the sole trader often practically means cessation of the business

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