There are many reasons to incorporate a business. It can offer tax advantages, give your business more credibility, and help you secure business credit. These are great benefits, but the main reason why many sole traders decide to incorporate is to protect their personal assets from creditors.
Operating as a sole trader is a risky affair. Creditors can chase you for outstanding debts and if you cannot pay, your home and personal assets are at risk. The situation is very different if you operate a limited company or corporation.