Choose a business name. Unlike an LLC or corporation, if a sole proprietorship loses a lawsuit or otherwise finds itself in debt, not only will the business be liable for the debt, but the owner/sole proprietor will be as well. If the sole-proprietor or the partnership is GST registered, the business owner also has to apply for cancellation of GST registration with IRAS. lack of continuity In a sole proprietorship, any debts or damages incurred by the business that cannot be paid by the business are your personal debts and you must pay them. A SP is tied to the individual and is not a “passable” entity. So before you terminate your Sole Proprietorship, you need to know the procedure of termination of a business. All the business assets of a sole proprietorship will be in your name, so you can sell whatever is left after taking care of your business obligations. The Transfer and Termination of a General Partnership; Business owners often sell a business and expect to be rid of future obligations. Liability issues are of particular concern for sole proprietors because the owner is personally liable for claims against the business. You will be required to obtain a new EIN if any of the following statements are true. In this event, the partnership will have to dissolve and cease being a partnership for state law purposes. To find out how to establish a sole proprietorship in any other state, see Nolo’s 50-State Guide to Establishing a Sole Proprietorship. Obtain licenses, permits, and zoning clearance. You are subject to a bankruptcy proceeding. File an assumed name certificate with the county register of deeds office. Secondly, all business assets that belonged to the Sole Proprietorship must be transferred to the new Private Limited Company, within 3 months of incorporation. Obtain an Employer Identification Number. Business may be terminated for the following reasons, Cessation of the business, Bankrupt, Death of the owner, Pursuant to Court Order. Lastly, the ACRA must be posted about the termination of the Sole Proprietorship and the conversion to the Private Limited Company. These business structures are both more conducive to ownership transfer than a sole proprietorship. This occurs if all its operations are discontinued and no part of any business, financial operation, or venture is continued by any of its partners. A sole proprietorship legally terminates immediately upon the death of the owner. Sole Proprietors. You take in partners and operate as a partnership. #4 Personal Bankruptcy/Credit Risk In addition to the option to set up your business a sole proprietorship, in most states, you also have the option to set up your business as a single-member limited liability company or a single-member S corporation business. TERMINATION OF THE BUSINESS. You purchase or inherit an existing business that you operate as a sole proprietorship. Even if a spouse, relative, or friend of the deceased owner assumes ownership and keeps the business operating under the same name, legally a new business … While the owner is entitled to all profits from the business, he is also responsible for the business’ debts, liabilities, and losses. A real termination for tax purposes occurs when a partnership ceases doing business. The term sole proprietorship refers to a business owned and operated by one person, which is not registered as a corporation or a limited liability company.In a sole proprietorship, there is no legal distinction between the individual and the business owner. The term of the business being dependent on the life of the business owner is referred to as _____. A sole-proprietor / partner may notify ACRA it has ceased business by filing the "Cessation of Business" online via BizFile + using Singpass or Corppass. 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