Festive Savings Are Here. Get 10% OFF on All CCI Pro Plans. Subscribe Now!

Investment in sole proprietorship business

693 views

Save Share

Join Us Follow Us Add as Source

divyanshu yadav

student

64 Points Posted on 15 February 2020

Hi,

Please suggest ways in which I can invest money in a sole proprietorship business run by one of my friend.

Thanks

Replies (3)

Quick Summary

If you wish to invest money in a friend's sole proprietorship business, you cannot become a partner as it's a single-person entity. Instead, you can provide a loan with agreed interest or salary, or contribute funds under mutual terms without formal partnership. This ensures the business remains a sole proprietorship while you receive a return on your investment.

Atif Khan

110 Points Posted on 15 February 2020

If you invest money you will become a partner... partnership need not be registered compulsarily.. so u can invest and agree on salary or profit.. Sole proprietor means a single person entity.. if there are partners it will become a partnership..

sujith kumar dasa

banglore

988 Points Posted on 15 February 2020

Sole proprietorship is a single person entity and hence others can't invest there. However you can give loan to them, on which interest can be paid to you and salary can be paid as per salary agreement

Kapadia Pravin

10683 Points Posted on 16 February 2020

You can put in money in any manner under mutual terms. After all you are giving mere finance to your friend and nothing else. You can give interest free also.