Sole proprietorships

Starting a sole proprietorship is the simplest way to set up a business. As a sole proprietor you would be fully responsible for all debts and obligations related to your business. A creditor with a claim against a sole proprietor would normally have a right against the sole proprietor’s assets, whether business or personal. This is known as unlimited liability.

In a sole proprietorship, you would perform all the functions required for the successful operation of the business. These include:

  • Securing the capital

  • Establishing and operate the business

  • Assuming all risks

  • Accepting all profits and losses

  • Paying all taxes

The sole proprietor is said to be self-employed.