Sole Proprietorship
Definition
A business owned and run by one individual with no legal separation between owner and business. It is simple to set up, but the owner is personally liable for all debts and obligations.
Related Terms in Business Terms
Partnership Firm
A business owned by two or more people who share profits, losses and management under a partnership agreement. Partners are typically personally liable for the firm's obligations unless it is a limited liability partnership.
Limited Liability Partnership (LLP)
A business structure combining the flexibility of a partnership with limited liability for its partners, so a partner's personal assets are generally protected from the firm's debts. It is a separate legal entity.
Private Limited Company
A privately held company whose shareholders have limited liability and whose shares are not offered to the public. It is a separate legal entity, a common structure for growing businesses in India and elsewhere.
Working Capital Loan
Financing used to fund day-to-day operations — inventory, payroll, payables — rather than long-term assets. It bridges timing gaps between paying suppliers and collecting from customers.
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