What are characteristics of a sole trader?

Also known as a sole proprietorship, a sole trader is a form of business that is owned and operated by a single person. A sole trader does not experience many legal formalities, assumes all the risks with unlimited liability and is solely responsible for business decisions.

Sole traders are responsible for the legal and financial status of the business. This means that debts and legal issues of the business are transferred to the owner. A sole trader makes every decision of the business and has complete authority over it. He chooses whatever name best suits his type of business and is responsible for all business records.