||Exclusive owner of the business, entitled to keep all profits but liable for all losses
||·Low cost, easy to set-up
·Very little financial reporting or business administration
|·Full liability for debt
·Personal tax liabilities on profits which can be less efficient
||Between two or more individuals who share management and profits
||·As above, but with more owners
·More potential to raise finance
|·As above but affecting all partners jointly and severally.
·Governed by very old law unless a Partnership Agreement is created.
·Can be messy to wind up
||Private company whose owners are legally responsible for its debts only to the extent of the amount of capital they invested
||·Less personal financial exposure
·Favourable tax regime
·Conduct of the business conducted in accordance with constitution – Articles of Association. Central rule book so-to-speak!
|·Administrative and regulatory demands heavier
·Annual accounts and financial reports must be placed in public domain
|Limited liability partnership (LLP)
||Some or all partners have limited liabilities, and exhibits elements of partnerships and corporations
||·Flexibility: can be incorporated in members’ agreement
·Advantages of limited company and partnership combined
|·Profit taxed as income
·Partners must disclose income
·LLP must start to trade within a year of registration – or be struck off