Limited and Unlimited Liability

• What does it mean when a business has unlimited liability?

  The business owner(s) are personally liable for the debts of the event that the business cannot pay them
• What does it mean when a business has limited liability?

  The business owner(s) are only liable for the debts of a business up to the amount of money they have invested in the business
• What types of business might have unlimited liability?

  • sole trader
  • partnership
• What type of business will have limited liabilty?

  • LTD
  • limited liability partnership
• What is another word for liability?

  Responsiblity