GLOSSARY

Canadian Financial, Real Estate and Mortgage Glossary

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Sole Proprietorship


Synonyms:proprietorship, sole trader
Filed Under: financial-banking, investments, legal-contracts
Tags: banking, contract, investment, legal
 

Definition of sole proprietorship

sole proprietorship
1. A type company that is owned and run by a single person. Unlike with corporations, with sole proprietorships there is no legal distinction made between the owner and the company. The owner receives all business profits but is also is liable for all the company's losses, debts, and legal obligations. Also known as "sole trader" or "proprietorship."

Related Terms and Acronyms:

  • business (busn)   A company, either for-profit or non-profit.
  • commercial loan   A loan taken out by a business.
  • commercial mortgage   A mortgage for commercial property.
  • corporation   A legal entity that is legally separate from its owners and employees.
  • equity   The value of a property minus outstanding mortgage debt and other liens.
  • incorporated business   A company that exists as a corporation.
  • privately held company   A company that is not listed on a stock exchange.
  • publicly traded company   A company that is sold on a stock exchange.
  • self employed person (SEP)   A person who runs a trade or business, rather than working as an employee for someone else. You are self-employed if you are a sole proprietor or a partner working in a business. You can be an employee and self-employed at the same time if you have an independent business outside your regular employee hours. To qualify for many business tax exclusions and deductions, the enterprise must make a profit in three of five years. In most cases in order to qualify you must take and average of the last 2-3 years tax assessments.

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