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Sole Traders

A sole trader, also known as a sole proprietorship, is a type of business structure where a single individual owns and operates the business. Here are some key features of a sole trader:

  • Single owner: The sole trader is the only owner of the business and is personally liable for all debts and obligations of the business.
  • No legal distinction: There is no legal distinction between the owner and the business, and the owner is personally responsible for all the decisions and actions of the business.
  • Easy to set up: Setting up a sole trader business is relatively easy and requires minimal paperwork, making it a popular choice for small businesses and entrepreneurs.
  • Unlimited liability: One of the main drawbacks of being a sole trader is that the owner has unlimited liability, meaning that they can be held personally responsible for any debts or legal obligations of the business.
  • Taxation: Sole traders pay taxes on their business income as personal income, and are subject to personal income tax rates.

Overall, sole trader businesses are a simple and flexible business structure that can be an ideal choice for small business owners and entrepreneurs looking to start their own business.

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