Sole Proprietor or Sole Trader

A tax term used for a freelancer or self-employed individual who owns and operates their business as an individual without forming a separate legal entity.

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Becoming a sole proprietor is generally understood to be the simpler option, requiring fewer steps to get started. This structure allows the individual to have full control over business decisions and operations, while also bearing personal responsibility for all business liabilities and debts. Sole proprietors report their business income and expenses on their personal tax returns, streamlining the tax process but also merging personal and business financial obligations.