| Business Type |
Advantages
|
Disadvantages |
| Sole Proprietorship |
- ease of formation
- low start-up cost
- owner controls decision making
- minimal working capital required
- tax advantages to owner
- all profits to owner
|
- unlimited liability
- difficulty raising capital
- lack of continuity
|
| Partnership |
- ease of formation
- low start-up cost
- additional sources of capital available
- broader management base
|
- unlimited liability of general partners
- lack of continuity
- difficulty in finding suitable partners
|
| Corporation |
- separate legal identity
- limited liability
- specialized management
- ownership is transferrable
- perpetual existence
- tax advantages
- easier to raise capital
|
- most expensive start-up
- closely regulated
- charter restrictions
- extensive record keeping
- double taxation of dividends
|