You've decided to take control of your destiny, be your own person, and do your own thing. GREAT! You have a sound business plan and the drive and skills necessary to succeed. Now all you need to do is get started – but how? The first thing to do is to decide how you are going to carry on your business: as a sole proprietorship, partnership or corporation. Here is a simple comparison to get you thinking:
| SOLE PROPRIETORSHIP | PARTNERSHIP | CORPORATION |
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| you own and operate yourself, the proprietor and his or her business is considered one and the same | joint effort between 2 or more people, each partner is liable for the actions of the other | is an independent personality, a separate legal entity |
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| you run the business using your own personal bank account, all profit or loss is yours alone | partners share equally the capital and profits of the business, a business bank account is easier | the owner is a shareholder of the corporation but s/he does not own the assets |
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| keep separate financial records | keep separate financial records | the corporation keeps its own complete set of financial records |
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| business profits are reported on your personal income tax | business profits are reported on your personal income tax | profits and losses are held within the corporation |
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| the sole proprietorship dies with the owner | the business may not survive the death of a partner | a corporation can live forever as long as it is registered with the Corporate Registry |
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| you are personally liable, not covered by any specific legislation | partnerships are governed by The Partnership Act | the corporation is liable for its business debts not the owners |
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| cost of setting up - optional: may wish to search and register your trade name | cost of setting up - may or may not have to file a Declaration of Partnership with Corporate Registry | cost of setting up - sizeable corporation fees, possible legal, bookkeeping & tax preparation fees |
