What are the features of Sole Proprietorship?

It is vital to know important things before incorporating a business. One such vital aspect is features of a Company, namely:

  • Simplest form of carrying business opted for small businesses due to its ease of setup and nominal cost.
  • Easy and simplified registration and incorporation formalities.
  • The management, control and ownership vests in a single person.
  • It has no separate legal entity as that of an incorporated business. Its legal entity is same as that of a person who owns it.
  • It is not transferable or heritable.
  • The liability incurred by the owner is a personal liability. Debts of the proprietorship become the debts of the owner.
  • The profits accrued by the proprietorship are the profits accrued by the owner. Thus, it gives a pass-through tax advantage.
  • It does not have perpetual existence or succession.

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