What aspect of a business is defined by sole proprietorship?

A sole proprietorship is defined by its single individual ownership. This means the business is owned and operated by one person, who is responsible for all aspects of the business, including its debts and liabilities. This structure is the simplest form of business organization and does not require formal registration, making it accessible for individuals looking to start a business independently. The owner has full control over decision-making and retains all profits generated by the business.

In contrast, other structures like partnerships involve multiple owners sharing responsibilities and profits, while corporations have a distinct separation between ownership and management. Additionally, while sole proprietorships do not provide legal liability protection—meaning the owner can be personally liable for business debts—this is not a defining characteristic of the sole proprietorship itself. The defining feature remains the single individual ownership aspect.