Sole Proprietorship How ?
A sole proprietorship is the oldest and most common form of business structure for a small business. A sole proprietorship is a business structure owned, operated and managed by a single individual.
Sole proprietorship firm is not a legal entity and does not have a distinct status than the owner.
A sole proprietorship is also known as a sole trader or simply a proprietorship. It is a business structure owned and run by a single individual and in which there is no legal distinction between the owner and the business. The identity of the organisation is nothing but the individual himself. The owner receives all profits (after tax) and has unlimited responsibility for all losses and debts.
He/she is the sole authority to take decisions, enjoy all profits of the firm and is personally liable for all losses of the firm. The proprietorship form business carries unlimited business risk, as the business proprietor is individually responsible to settle all business liabilities. The proprietor’s personal assets are at risk to compensate for the business liabilities.