When to register as self-employed or form a limited company
Posted: Tue Dec 17, 2024 5:27 am
If you are reading this post, it is quite likely that you are thinking about creating a business and you are not sure whether it is better to set up an SL or register as a self-employed person.
Becoming an entrepreneur requires making various choices that will have an impact on the future of the company.
One of the most important questions you will have to think about is whether to be self-employed or to form an LLC?
You will have searched for information on the Internet because you know that it is an important decision, so we want to give you all the keys to choose correctly.
Starting your own business is exciting and comes with many benefits as well as many responsibilities.
What criteria should you follow when choosing?
Before deciding to become self-employed or set up an LLC, you must answer several questions:
Are you going to work alone or have partners? In the first case, it will be best to register as self-employed , at least initially, and in the second case, you will have to find a way to form an association: community of property, SL or SA.
What responsibility do you want to assume for insurance email list the business? If you are self-employed, you are liable for the company's debts with your own assets (except in the case of a limited liability entrepreneur) and in the case of an SL, the company's assets are liable.
Do you have money to contribute to the share capital? To set up a limited company you will need a minimum capital of 3,000 euros.
These are the three essential questions, and now we will analyze the advantages of each option.
Self-employed vs. SL: that is the question
The differences that will help you decide are as follows:
Initial bureaucracy. Registering as a self-employed worker is the easiest way to start a business on your own. You will have to register with Social Security and the Treasury. To set up an SL, you have to complete more paperwork: request a certificate of name from the Commercial Registry, execute a public deed of incorporation before a Notary and register with the Treasury and Social Security, among others. More paperwork also means more time and more money.
Liability. As we have seen before, the liability of the self-employed person is unlimited and that of the company is limited to the company's assets.
Initial capital. For a limited company it is 3,000 euros, while in the case of self-employed persons there is no share capital.
The self-employed fee. The self-employed fee of an individual entrepreneur benefits from the flat rate, which is not the case for a corporate self-employed person who pays a higher fee.
Becoming an entrepreneur requires making various choices that will have an impact on the future of the company.
One of the most important questions you will have to think about is whether to be self-employed or to form an LLC?
You will have searched for information on the Internet because you know that it is an important decision, so we want to give you all the keys to choose correctly.
Starting your own business is exciting and comes with many benefits as well as many responsibilities.
What criteria should you follow when choosing?
Before deciding to become self-employed or set up an LLC, you must answer several questions:
Are you going to work alone or have partners? In the first case, it will be best to register as self-employed , at least initially, and in the second case, you will have to find a way to form an association: community of property, SL or SA.
What responsibility do you want to assume for insurance email list the business? If you are self-employed, you are liable for the company's debts with your own assets (except in the case of a limited liability entrepreneur) and in the case of an SL, the company's assets are liable.
Do you have money to contribute to the share capital? To set up a limited company you will need a minimum capital of 3,000 euros.
These are the three essential questions, and now we will analyze the advantages of each option.
Self-employed vs. SL: that is the question
The differences that will help you decide are as follows:
Initial bureaucracy. Registering as a self-employed worker is the easiest way to start a business on your own. You will have to register with Social Security and the Treasury. To set up an SL, you have to complete more paperwork: request a certificate of name from the Commercial Registry, execute a public deed of incorporation before a Notary and register with the Treasury and Social Security, among others. More paperwork also means more time and more money.
Liability. As we have seen before, the liability of the self-employed person is unlimited and that of the company is limited to the company's assets.
Initial capital. For a limited company it is 3,000 euros, while in the case of self-employed persons there is no share capital.
The self-employed fee. The self-employed fee of an individual entrepreneur benefits from the flat rate, which is not the case for a corporate self-employed person who pays a higher fee.