toiminimenä

A toiminimenä, often translated as "sole proprietor" or "self-employed person," refers to an individual who conducts business activities under their own name without establishing a separate legal entity like a limited company. In many jurisdictions, this is the simplest and most common form of business ownership for individuals starting out. The individual is personally responsible for all business debts and obligations. This means that their personal assets can be used to satisfy business liabilities.

Operating as a toiminimenä typically involves less administrative overhead compared to forming a corporation. Registration processes are usually straightforward, often requiring only notification to relevant tax authorities. Accounting and bookkeeping requirements may also be simplified. The business income is generally reported as the individual's personal income on their tax return, and they are responsible for paying income tax and social security contributions based on their business profits.

While offering simplicity and lower startup costs, the unlimited personal liability is a significant consideration. This structure is generally more suitable for low-risk businesses or for individuals who are just beginning to explore entrepreneurial ventures. The legal and financial responsibilities fall entirely on the individual.