What is the Difference Between Sole Proprietorship, GP and Corp

ByLaura Harvey
Sole Proprietorship Vs Partnerships Vs Incorporation

Originally Published: Feb 13, 2017

The structure of your business is one of the first decisions you’ll need to make as a business owner. Different business structures offer unique benefits and limitations that you should be aware of.

Understanding the difference between a sole proprietorship, partnership, and incorporation help you determine the best choice for your organization.

Sole proprietorship

A sole proprietorship is any business that consists of one single owner. A sole proprietor is responsible for managing many different aspects related to the business including debt and legal responsibilities.

The owner of a sole proprietorship receives all of the profits from the business. But this means that claims can be made against the owner’s personal assets along with those of the business.

A sole proprietorship can be established easily and with minimal cost and the owner maintains full control of the ongoing operations.

Register a Sole Proprietorship

General Partnerships

General Partnerships consist of two or more individuals who share their resources in order to build the business. All of the parties in a given partnerships share the profits.

A General Partnership holds all parties liable for any outstanding debts and obligations.

A partnership agreement is typically used to define the terms by which the partnership operates. This is especially useful in resolving any partnership issues and prevents unwanted costs and disruptions to your business.

Partnerships allow startup costs, profits, and management to be shared among the partners. This makes it easy to grow your business through the use of shared resources and risks.

start a business

Incorporation

Incorporations can be established by businesses looking to operate in one or more Provinces.

Incorporating may protect the shareholders from being liable for the legal obligations and or debts of the business.

In addition to limited liability, Incorporations allow ownership to be transferred to other individuals and provides the opportunities to add or remove the directors and or shareholders of the business.

Incorporated businesses may also have lower tax rates when compared to partnerships and sole proprietorships.

Understanding the difference between a sole proprietorship, partnership, and incorporation is important. If we can be of assistance,

Speak With One of Our Experts to get on the road to business ownership.

Laura Harvey
Laura Harvey

Laura Harvey stands as a beacon of entrepreneurial support and expertise, embodying the spirit and drive of the community she serves. As the proud owner of Ontario Business Central Inc., Laura's journey is one of dedication, passion, and an unwavering commitment to nurturing the entrepreneurial landscape in Canada.

With over three decades of experience as a corporate specialist coupled with over 25 years of entrepreneurial ventures, Laura brings a wealth of knowledge and insight to her role. Her expertise is not just theoretical; it's built on the real-life challenges and triumphs of navigating the business world. This unique blend of professional and personal experience positions Laura as a relatable and trusted guide for those embarking on their entrepreneurial journey.

Beyond her role at Ontario Business Central, Laura has extended her outreach through the innovative YouTube series "Taking the Leap." This platform allows her to connect with new business owners, offering them a stage to share their stories and insights. "Taking the Leap" is more than just a series; it's a community where aspiring entrepreneurs can find inspiration, learn from the experiences of others, and gain practical advice on crucial corporate tasks like registering a business, updating business information, understanding tax account intricacies, and much more.

Laura's contributions extend into the digital world through her in-depth blogs for Ontario Business Central. Here, she delves into topics essential for entrepreneurs and business owners looking to start, manage, and grow their ventures. Her writing is a reflection of her passion for supporting entrepreneurial advancement and a testament to her deep understanding of the corporate sphere.

Laura Harvey is not just an entrepreneur; she's a mentor, guide, and fellow traveler on the path of business ownership. She embodies the ethos of "walking the walk," providing both the tools and the encouragement for others to thrive in their entrepreneurial endeavors. Whether through her written words, her YouTube series, or her hands-on approach at Ontario Business Central Inc., Laura is dedicated to uplifting and assisting new and established business owners alike.

You can find Laura on Linkedin and Twitter and Youtube.

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Taking The Leap YouTube Series