Business

Sole Trader

When a business is a sole trader it means that one person owns and runs the business. There are no
other people involved. The business must be registered with a legal body such as the government

Partnership

When a business is a partnership it means that more than one person owns and runs the business. A
partnership can have multiple partners, although India states no more than 20. Some partnerships have
verbal agreements (spoken) however it is better to make sure agreements are written, which is a written
agreement. These can be logged with a legal body to protect partners in case of disagreement.

Private Limited Company

A Private Limited Company (Limited) is a separate entity, owned by people who have shares in the
company. It means that the people who own the shares (own the company) are not liable for any debts.
Shareholders appoint people to run the company, these people are called directors. Shares can’t be sold
to the public, shares are not easily transferred, accounts must be made public, lots of legalities

Public Limited Company

A PLC is a huge organisation that operates in the private sector. To avoid confusion it is known as a PLC.
If one of the owners no longer wants to be part of the business they can sell shares to someone else. If
they die their shares can be passed on. These are the shareholders , whoever has the most shares has
the most power as they have bigger vote. Lots of money can be raised via share issues as unlike Limited
companies they can buy and sell to the public. Lot’s of regulations in place to protect shareholders.