Basic LAW Essay Example | Topics and Well Written Essays - 1000 words

Basic LAW - Essay Example The business that has been decided to be set up is that of transport business. This business operation will deal with lending car on rental basis to the tourists’ companies which operates with planning trips for the tourists. Australia is an attractive location for the tourists and thus holds good scope for the business. The cars will be bought new for providing them on rental to the tourists’ companies. The business will operate on the type of â€Å"sole trader†. Thus the aim of this paper is to evaluate the advantages and disadvantages of sole trading business along with the other forms for comparing and thus to justify this choice of the business form. The name of the business would be â€Å"Lark Travels†. Lark is the name of a songbird. The benefits and the drawbacks of registering names for business will also be evaluated in this paper. Sole Trader Business: Advantages, Disadvantages, Legal Requirements and Liabilities of the Party Sole trader which h as been selected as the form of the business is known to be as the most inexpensive and the simplest structure to be set up. The best way to have a business name is to have it by the trader’s own name; otherwise the trader needs to register the business name with Consumer Affairs Victoria. The sole trader holds the entire liability of the business. The liability holding does not vary in case if the business is registered with a name other than his or her name. An income declaration is essential to be included by the sole trader; the income which is earned from the business. A business plan is required in case the sole trader is opting for taking loan from any of the financial institutions. The tax is paid by the sole trader at a rate of personal tax, although he or she may be required to pay provisional tax. The liability of sole trader business is unlimited and can even broaden up to sole trader’s personal assets inclusive of any assets which are owned jointly with an other person. The advantage of sole trader business is that it bears low fees of establishment. The entire control over the business lies with the sole trader and he enjoys the entire profit from the business. During low business profits, there exist taxation advantages. There is applicability of less legislation in this business form. The only two legislations applicable are Contract Law and Tax Assessment Act. Despite the advantages, the sole trading business can pose as a risk towards the trader’s personal finances. The capital deems limited by the sole trader’s personal assets and also there prevails limited expertise of the trader. He is subjected to unlimited legal liability and he is solely responsible for all the debts and liabilities. At times, it may become hard to ‘pass on ownership’1. Partnership Business: Advantages, Disadvantages, Legal Requirements and Liabilities of the Parties Partnership businesses are similar to the sole trader busin