Sole+Proprietorship

= SOLE PROPRIETORSHIP =

A sole proprietorship is a business owned by one person. The owner may operate on his or her own or may employ others. The owner of the business has personal liability of the debts incurred by the business.

ADVANTAGES

 * Easy and inexpensive to form a sole proprietorship (you will only need to register your business name provincially, except in Newfoundland and Labrador)
 * Relatively low cost to start your business
 * Lowest amount of regulatory burden
 * Direct control of decision making
 * Minimal working capital required to start-up
 * Tax advantages if your business is not doing well, for example, deducting your losses from your personal income, lower tax bracket when profits are low
 * All profits will go to you directly

DISADVANTAGES

 * Unlimited liability (if you have business debts, personal assets would be used to pay off the debt)
 * Income would be taxable at your personal rate and, if your business is profitable, this may put you in a higher tax bracket
 * Lack of continuity for your business if you need to be absent
 * Difficulty raising capital on your own