Business Structure

Sole Proprietorship

In a sole proprietorship, the owner is 100% liable (legally responsible) for the business, including all debts and actions. The business income tax is filed with the owner’s personal income.

Some examples of common sole proprietorships are housecleaning services, real estate agents, landlords, general contractors, agriculture (those who own farms, ranches, nurseries and orchards), etc.

Pros

  • Low start-up costs
  • Greatest freedom from regulations
  • Owner has full control

Cons

  • Unlimited liability (you can be sued)
  • Lack of continuity
  • Difficult to raise capital
  • Limited transfer of ownership

Partnership

In a partnership, each partner is wholly liable for the business. Debts and profits are shared among the partners. It is strongly recommended that a Partnership Agreement be drawn-up by a lawyer.

Some examples of common partnerships are accounting firms, law firms, doctors’ offices, etc.

Pros

  • Low start-up costs
  • Broader management base
  • Possible tax advantages
  • Limited outside regulations

Cons

  • Unlimited liability
  • Lack of continuity
  • Divided authority
  • Limited transfer of ownership
  • Difficult to find suitable partners

Corporation

A corporation is a distinct legal entity where owners have legal liability up to the limit of their investment. Debts and profits are shared among shareholders. Incorporating can be complicated so legal and accounting assistance is recommended.

Pros

  • Limited liability
  • Ownership is transferable
  • Possible tax advantages
  • Continuous existence
  • Easier to raise capital

Cons

  • Closely regulated
  • Costly to set-up
  • Charter restrictions
  • Record keeping requirements
  • Complex tax rules

Help Me Choose

  • I plan to own and operate this business myself
    • Sole proprietorship
    • Corporation
  • This will be a small business without a lot of risk
    • Sole proprietorship
    • Partnership
  • I plan to share ownership and management responsibilities with others
    • Partnership
    • Corporation
  • This will be a business that has employees and equipment so I would like to limit risk.
    • Corporation
  • I would like to seek investment from other people
    • Corporation

Workshops + EventsView All

Jul 23

Are you interested in becoming an Entrepreneur? Well we have just the course for you.

Jul 25

Are you an employer with new staff to the city?  Let them know Kingston Economic Development and KEYS Job Centre are hosting monthly Welcome Nights on the last Thursday of every

Jul 25

Attend this free one-hour session to learn about the programs and services offered at Kingston EcDev that can help start and grow your business.

Aug 1

Attend this free one-hour session to learn about the programs and services offered at Kingston EcDev that can help start and grow your business.

Aug 6

Do you need to sharpen your financial ability?

Aug 8

Do you want to follow your passion to create a business that puts people and planet first? You are not alone.