The Sole Trader structure is the simplest form of business structure where there is no division between business and personal assets. Most sole traders opt to trade under their own name whilst others choose to register a business name (see “Do I need to register a business name” for more info).
- This structure is the least onerous in terms of reporting requirements and gives the owner the most control of their business.
- Losses incurred in business activities may be offset to other income earned (such as wages or on investments).
- The biggest downside to this business structure is unlimited liability. This means that all of a sole trader's personal assets are liable to be used against business debts and obligations.