Tipos de Empresas: Criterios de Elección

• The different types of business that can be created.
• These are determined based on the number of partners, the type of responsibility, and the contributed capital.
• A promoter's choice of juridical form should be based on rigorous study to determine the type best suited to the project's characteristics and needs.
• Different juridical forms imply different types of responsibility.
• The choice may affect the entrepreneur's personal assets or those of the partners, in the case of a company.
• Reference should be made to fundamental characteristics when looking at legal requirements for each legal form.
• This global view offers essential information when deciding and facilitates both the creation of a company and its efficient functioning and stability.

Criteria for Choosing a Juridical Form

• While there are no exact rules for choosing a juridical form, several general criteria should be considered.
• The criteria are detailed in the following schema:

Constitution and Management

• This involves procedures, requirements, and economic costs.
• It can involve a single member or multiple promoters.

Number of Partners

• Legal considerations include the required economic contribution.
• This can involve capital or assets, with tax considerations like IRPF or IS.

Patrimonial Responsibility

• This can be limited or unlimited.

Complexity of the Constitution and Management

• Choosing a merchant juridical form can imply a large number of bureaucratic procedures.
• However, decisions should not be based solely on bureaucracy.
• Certain activities may require a specific juridical form.

Number of Members

• The number of members participating in the project is an important consideration.
• A single person commonly chooses the juridical form of individual businessman, or autónomo.
• It could also be a company formula, like the limited responsibility company.
• If there are multiple members, only forming a company is possible.
• The juridical formula we choose will be conditioned by the minimum and maximum number of members established by law for each company, which can be seen in the table on the left.

Economic Essentials of the Project

• The economic dimension of the project may necessitate a certain level of investment.
• Certain types of company require a minimum capital to be available in order to be constituted as a company.
• The capital stock is the contribution of money, goods or work made by the partners to the company.
• It is used for the start-up and functioning of the business, and becomes part of the company.
• The contribution of each partner makes him/her the owner of the company in the proportional part of the capital contributed.
• The law establishes a minimum capital stock for some of the juridical forms.

Fiscal Aspects

• Each juridical form is subject to a different taxation regime.
• There are two large groups for tax purposes:
  • Juridical forms subject to the tax on the income of natural persons (IRPF) in its different forms (direct estimation or objective estimation).
  • Those submitted to the tax on companies (IS).
• The tax amount is different in each case.
• In IRPF, it varies depending on the performance of the business, so that it increases the more you earn.
• In the IS, in general, 25% of income is paid to the Tax Agency as tax.

Patrimonial responsibility of promoters

• The patrimonial liability that we have to face with the Administration, clients, suppliers, workers and banks is another fundamental factor.
• The patrimonial responsibility is the obligation on the part of the promoters to respond to the debts generated by the business activity.
• There are two types of patrimonial liability:

Limited

• Covers the assets, rights and capital in the name of the company.
• It will never reach the personal assets of the promoters.

Unlimited

• Covers the assets, rights and capital of the company and, if these are not sufficient, also the personal assets of the partners.
• Another way of classifying patrimonial responsibility is according to who is obliged to respond:

Subsidiary responsibility

• When a person must assume responsibility in default of the principal obligor.

Joint and several liability

• The entire debt can be demanded from any of the partners.

Joint liability

• Each partner is liable for the debt in proportion to their contribution to the share capital.

Other aspects to consider when starting a business

• There are other less important criteria.

Freedom of action of the entrepreneur

• The margin of action and freedom in decision-making are absolute in the cases of the individual businessman and of the unipersonal companies.
• At the opposite extreme would be, for example, the personalist commercial companies, in which decisions are not made on the basis of the share capital held, but each person represents a vote.

Image

• In some cases, potential clients demand that we project an image of solidity that unipersonal formulas do not possess.

Access to public aid

• Although it is not a recommendable criterion in itself when choosing the juridical form, it is a variable that we must take into account, so that we must attend to the circumstances of each project and to each specific call for applications.

Individual Juridical Forms

• In some situations, companies do not have their own legal personality.
• The "empresario", or "holder", is personally liable for all obligations the business incurs.
• There is no difference between their personal and commercial assets.
• In addition to the individual proprietor, both communities of property and civil partnerships are in the same situation.

Solo Entrepreneur

• The solo entrepreneur is an individual who, in his or her own name and through a company, carries out a commercial, industrial or professional activity.
• From a legal point of view, a solo entrepreneur has a few characteristics:

Age and Capacity

• Of legal age, or of younger age in some situations, and has legal capacity (free availability of his or her assets).

Own Name

• The exercise of the entrepreneurial activity takes place in their own name.

Habitual Activity

• Carries out an entrepreneurial activity in a habitual, not occasional, way.

Unlimited Patrimonial Liability

• It is to say, that it responds to the fulfillment of its obligations with all its present and future assets.

Advantages

• Rapid and simple procedures at the start of the activity, as it does not require a public deed before a notary or registration in the Mercantile Registry; it is suitable for small companies.
• No minimum capital required.
• Simplicity of formal and tax obligations.

Disadvantages

• Extended to all the assets of the promoter of the initiative.
• May be subject to a high tax rate if the volume of benefits is important, given the progressivity of the IRPF.
• Cannot have partners.

The Self-Employed

• Is an individual who has a special Social Security contribution regime.
• A self-employed or self-employed worker is considered to be anyone who, on a regular, personal and direct basis, carries out an economic activity for profit, without being subject to a contract, regardless of whether or not they use paid services from third parties.

Characterized By

• The relationship with its clients is not subject to any employment contract.
• They are obliged to register as self-employed workers (RETA) with the Social Security.
• They are subject to the obligations of an individual entrepreneur: tax on economic activities (IAE), opening of establishment, payment of VAT, etc.
• They have a direct or objective estimation regime with regard to the IRPF.

The ERL

• The Entrepreneur with Limited Liability
• Is a variant of the self-employed worker.
• The entrepreneur with limited liability is the individual who, with limitation of liability under certain conditions, performs on a habitual, personal, direct, on his own account and outside the scope of management and organization of another person an economic or professional activity for profit.
• The entrepreneur with limited liability is, therefore, a self-employed worker who is allowed to protect his habitual residence against possible debts, which obliges him to register the company in the Mercantile Registry and to add some initials to the name.

Key Characteristics

• May limit its liability, avoiding that the liability arising from its business debts may affect its habitual residence, provided that its value does not exceed €300 000.
• Must be registered in the Mercantile Registry and indicate the real property, its own or common (in case of marriage), that it intends not to be bound by the result of the business or professional activity.
• Has total control of the company it manages.

The Capital Contribution

• The company is limited by the will of the businessman.

Advantage

• Is that it is a suitable form for companies of small size.
• Can be cheaper, given that no legal person is created other than the entrepreneur himself.

Community of Assets (CAB)

• Is a private contract by which the ownership of an asset or right belongs in an undivided form to several people, called communers.

A Community of Assets Possesses

• Not Divisible
• Several proprietors.
• The number of members is two, have unlimited liability and there is no capital minimum required for its establishment.
• As for its tax regime, is the community as such that must register with the IAE, not each of its members.
• Not the legal person, the company is taxed by the IS, but each member in proportion to the benefits he obtains of property.
• Must declare the VAT form jointly throughout the company.
• If worker on behalf of someone must be high in the social security in the general scheme.

Civil Society

• A civil is one where two or more persons undertake to do together money, goods or industry for the purpose of breaking apart among themselves gains arising from the business.
• The civil society has real legal personality where there is a public document.