1. Different investors: a limited liability company can be a natural person or a legal person, while a sole proprietorship enterprise has only one investor, that is, a natural person. The responsibility shall be borne by myself alone;
2. Different legal forms: a limited liability company is a legal civil subject with legal personality, but a sole proprietorship enterprise is not;
3. Different conditions for establishment: the contribution of a limited company shall not be less than 30% of the registered cost, and the sole proprietorship enterprise has not made mandatory provisions on the contribution;
4. Different tax regulations: limited liability companies need to pay enterprise income tax, and sole proprietorship enterprises do not need to pay individual income tax;
5. Investors bear different responsibilities: the shareholders of a limited liability company bear "limited liability" to the extent of their subscribed capital contribution, while the investors of a sole proprietorship enterprise bear unlimited liability to the company with their personal assets;
6. Different financial and accounting requirements: Limited companies should prepare financial and accounting reports at the end of each year and audit them by accounting firms. A sole proprietorship enterprise only needs to set up accounting books for accounting according to law, and does not need to be audited by an accounting firm.
A sole proprietorship enterprise has the following characteristics:
1, the establishment and dissolution procedures of enterprises are simple;
2. Flexible management. Business owners can completely determine their business strategies and make management decisions according to their own will;
3. The owner shall bear unlimited liability for the debts of the enterprise. When the assets of the enterprise are insufficient to pay off the debts, the owner pays off the debts of the enterprise with his personal property. It is beneficial to protect the interests of creditors, but a wholly-owned enterprise is not suitable for high-risk industries;
4. The scale of the enterprise is limited. The limited business income, the limited personal property of the owner, the limited work energy and management level of the owner all restrict the expansion of the business scale of the enterprise;
5. The existence of enterprises lacks reliability. The survival of a wholly-owned enterprise depends entirely on the personal safety of the owner, and the life span of the enterprise is limited. In the modern economic society, wholly-owned enterprises play an important role.
To sum up, the difference between a sole proprietorship enterprise and a limited company lies in different investors, different legal forms, different conditions for establishment, different tax provisions, different responsibilities of investors and different financial and accounting requirements.
Legal basis:
Article 3 of People's Republic of China (PRC) Company Law
The company is an enterprise legal person, with independent legal person property and legal person property rights. The company is liable for its debts with all its property.
Shareholders of a limited liability company shall be liable to the company to the extent of their subscribed capital contribution; Shareholders of a joint stock limited company shall be liable to the company to the extent of the shares subscribed by them.
Article 24
A limited liability company shall be established by capital contribution of less than 50 shareholders.
Article 2 of the Law of People's Republic of China (PRC) Municipality on Wholly Owned Enterprises
The term "sole proprietorship enterprise" as mentioned in this Law refers to an enterprise as a legal person established in China according to this Law, which is invested by a natural person, and its property is owned by the investor, who shall bear unlimited liability for the debts of the enterprise with his personal property.
Article 18
When applying for the registration of enterprise establishment, the investor of a sole proprietorship enterprise clearly regards his family property as his personal contribution, and shall bear unlimited liability for the debts of the enterprise with his family property according to law.