Here's a summary of each entity type:
- Sole Trader: an individual trading on their own and under their own name
- Partnership: an association of people/entities running a business together under their own names
- Company: a legal entity separate from its owners and managers (named the shareholders and directors respectively)
- Trust: an entity that holds property or income for the benefit of others
This is a significant decision, as it will make a big difference to the amount of tax that you pay and your legal and financial responsibilities.
This decision is highly dependent on your personal and business' circumstances. Please take a look at the following FAQs for the definitions of each entity type and which one would suit you best.