Self-employed vs. limited liability company: Which structure is more convenient?

[jrineakter]

You have decided to work for yourself, develop your project independently, follow an exciting path in your professional life: entrepreneurship. First of all, have your business idea well developed , understanding how you are going to move to achieve success. Before you get started, you must be very clear about certain essential management aspects for the launch of your business. We are here to help you know everything about each of them.

Today we are going to focus on one of the most important questions: do you want to be self-employed or a limited company? Each of these options has considerable advantages and some disadvantages to consider . Let's look in detail at everything that concerns this decision that will mark the first steps of your professional future. Let's start with limited companies –SL– and the option of having them made up of a single partner.


Differences in concept: What is a self-employed person compared to an SL?
The professionalization of self-employment can be legally defined in two main ways. On the one hand, you can consider being self-employed, without creating a company to work for. Another option is to form a company.

What does it mean to be self-employed?
Being self-employed means developing a professional activity independently, outside of an employment relationship.


You are responsible for your tax obligations
The main advantages are freedom and the option to diversify income, which provides independence. On the other hand, this self-employed person may have to face unforeseen events, instability and uncertainty, unlike an employed worker.

What is a limited company?
When deciding to become self-employed, a person can choose to set up a company. The limited company (SL) is a very popular type of business company in Spain. Many small and medium-sized companies (SMEs) are set up as SLs.

This goes beyond creating a italy number data website, purchasing a domain name and thinking of a brand name. Many freelancers have brands as if they were corporations, even if they are not legally incorporated.

What is a Sole Proprietorship?
You have probably read about limited companies more than once. This is the most common commercial company in Spain. In a country with a business structure supported by SMEs, the limited company offers more economic security for entrepreneurs. And this, given the inherent risk of any business, is always an advantage, as we will see later. If things go wrong, the entrepreneur will not have to respond with his personal assets to possible debts.

You can set up a limited company with as many partners as you choose. There is no maximum limit. And if you want to be the only one venturing into the exciting world of entrepreneurship ? No problem. We then change the name slightly and talk about a single-person limited company . In this case, it is a single person , physical or legal, who owns all the shares in the company.

We propose a definition to make things a little clearer: A single-person limited company is a commercial company made up of a single partner and in which liability is limited to the company's share capital.