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Partner - Accredited Specialist in Business Law
Senior Associate
Sole Traders & Partnerships
Many small retail and service businesses are run by sole traders or partnerships. These are businesses owned and operated in the names of the individuals involved.
Advantages:
- Simple and cost effective to establish
- Simple and cheaper accounting requirements
- Can be easier to change ownership
- Simpler tax arrangements
Disadvantages:
- Personal assets exposed to business and financial risks
- Reduced scope for effective tax planning
- Fewer opportunities for business succession planning
- Limited ability for growth (eg franchise, multiple locations)
- Dispute resolution can be expensive
While these are simple and relatively low cost structures to establish, they are not necessarily the best choice of entity for a business and are generally not suited to larger trading businesses.
If you intend to trade as a sole trader or partnership under a name other than your personal name, you will need to register a business in each State or Territory in which you intend to operate. Registering a business name does not give you ownership of the name. To protect your rights in a business name, you should register a trade mark.
For further information contact: