What type of organization is defined as a business run by one individual?

A sole trader is defined as a business run by one individual, making it the simplest form of business organization. This structure allows the owner to have complete control over all business decisions, profits, and liabilities. The sole trader is personally responsible for any debts incurred by the business, which means that their personal assets could be at risk if the business faces financial difficulties.

Sole traders benefit from straightforward tax obligations, as profits are typically taxed as personal income, simplifying the administrative processes involved. This type of organization is often favored by small businesses, freelancers, and self-employed individuals due to its simplicity and direct control over operations. The other types, such as partnerships, public limited companies, and private limited companies, involve multiple individuals or shareholders and have more complex governance structures and responsibilities.