<human>:  What is the difference between a limited company and a sole proprietorship?
<bot>: A limited company is a business that is separate from its owners and involves multiple members. It has its own legal identity, can hold property, can sue or be sued, is taxed on its profits, and must file annual financial statements. A sole proprietorship, on the other hand, is when a single person owns and runs a business, and does not have any legal separation between themselves and their business. Sole proprietors are personally responsible for all debts, liabilities, and obligations of their business and are taxed on their business income.