Also, the individual is legally responsible for any errors or omissions transacted by the business. You are in direct control of the business and are entitled to all of the profits. Disadvantages The owner is subject to unlimited personal liability. Contract consulting firms must deduct and remit CPP and EI premiums as required by law. Tax deductions for some expenses may be restricted.
All income is subject to personal tax rates.
A partnership is a business organization in which two or more persons agree to do business together. A formal business partnership is usually forged by contract between these individuals, preferably written and recorded. All business decisions and policies are made by mutual agreement of all partners involved. An informed partnership is inexpensive to start. It is relatively easy to comply with regulations.