A sole proprietorship is a business form where there is only one owner and there is no legal difference between the business and the owner. Here one single person holds the control. His liability is unlimited as the business and the owner has no legal difference. But due to the lower tax rate, flexibility and multiple advantages people prefer this structure for the early stage of business.
Benefits of Proprietorship
Easy to start
The cost of sole proprietorship registration is very less compared to any other business structure. The business runs on the identity of the proprietor himself.
Compliance norms for proprietorship are lower compared to other business structure like company and partnership.
Proprietorship business is not treated separately in for income tax purpose. The tax slab as specified for an individual’s income itself is applicable to the income of the business. The benefit of deductions is an added advantage with combined ITR for individual and the business.
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