Sole Proprietorship
Sole proprietorship is simple to set up and dissolve because a person can start to carry on business for their own account (Anthony VanDuzer, The Law of Partnerships & Corporations).
Advantage vs. Disadvantages
Other Things to Consider:
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A sole proprietor is limited to direct borrowing when it comes to raising capital. Employment status-wise, a sole proprietor may not be an employee of their business, i.e., contract with self. Income or loss are reported on the personal income tax forms. Finally, registration of the business name does not provide for exclusive use.
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As for the legal requirements, the business name may be registered under section 2(2) of the Ontario Business Names Act (the “Act”). Registration is required if you intend to use any name other than your full name. There are restrictions on business names which we can discuss on the call. There is a fine of up to $2,000 for failing to file for mandatory registration (OBNA, s. 10(2). The Ministry of Government and Consumer Services charges a registration fee payable to the Minister of Finance through ServiceOntario (electronically: $60; by mail: $80). There are other options to pay this government fee. The turn-around time differs.
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Under licensing rules, a sole proprietor needs to obtain a Master Business Licence (ServiceOntario).