A proprietorship firm is an unincorporated business run by a single individual, i.e., sole proprietor. The sole proprietor is the owner of the business and the management and control lie with the firm. The sole proprietor is entitled to all profits and liable for all losses in the business and pays personal tax on the profits earned.
The assets and liabilities of a proprietorship firm lie with the sole proprietor. Unlike a company, a proprietorship firm is not a separate legal entity. Sole proprietorship is not registered. This means that all liabilities extend from the business to the owner.
