What is a common characteristic of a sole trader?

A common characteristic of a sole trader is having complete control over business decisions. This means that the sole trader has the authority to make all operational choices, set business strategies, and manage the day-to-day functions without needing to consult or report to partners or shareholders. This autonomy is one of the main appeals for individuals who choose to operate as sole traders, as it allows for quick decision-making and flexibility in adapting to changes in the market or business environment.

In contrast, limited liability is typically associated with corporations or limited liability companies, where the owners' personal assets are protected from business debts. Partnerships involve multiple owners who share control and decision-making responsibilities, making them different from a sole trader structure. Tax-exempt status also does not apply to sole traders, as they are usually subject to standard taxation on business income. Therefore, the defining feature of complete control uniquely identifies the sole trader model in the realm of business ownership.