One of the most difficult things to do when starting a business is to choose the right legal structure. You can either register with the RETA to be self-employed or join a partnership with other professionals. We previously discussed the sole proprietorship, which can offer many benefits for those who choose it. Of course, we know there are a limited and anonymous company. But, do you also know there is a professional limited business?
Truth is, one thing has always worried us was the question of responsibility. It is a fact that if we do wrong, we must respond with our heritage. This is not something everyone can do. It is possible, however, that the limited company doesn’t fully reflect the original idea. Today we will be discussing the professional limited company. This is a legal form that many people don’t know about, but it can provide the answer to all our prayers. Here’s everything you need to know!
Many doubts can arise when we start a company with more than one person. Each one of them must pay their own expenses to function as independent contractors. Choose the most well-known model of society. There is an unusual model that requires some requirements. We will find out more about it later in this article. It is possible to be very beneficial if you comply with these requirements. This is a professional limited company. One of its key characteristics is the registration requirement for its members.
What does this signify? They must be members of a school, which is an entity that exists only in certain professions, and which unites a set of criteria for its professional. For example, this is true for professionals in law, engineering, and doctors. You can have many benefits by being a member of a school, but you also need to follow certain rules that apply to everyone. We could be removed from the school if we violate some of our obligations.
It is a task but nothing we should be concerned about if we don’t plan to do anything beyond the law and those regulations.
It is normal that a university degree is required for any professional activity we plan to engage in. Taxation is the most important benefit of a professional limited company. We’ll talk more about them later. However, we know that the SPL will provide taxation so partners won’t have to pay their debts.
Strangely, when starting a business, the first thing that comes to mind is to register as self employed. However, once we’ve learned how to look into the regional deductions for Income Statement, why not do more research about the options before taking a snap decision?
While we will be going into more detail about the pros and cons associated with a professional limited company, it is a good idea to start getting familiar with these concepts as soon as you can. Self-employed workers must pay off any debts using his assets. This means that you must pay any debts with your assets, such as the car or family home. The main draw of a professional limited partnership is the fact that it can be limited. This is because in the event that there is a problem, the partners will only be obligated to respond with assets of the company (limited by the subscribed capital).
This is crucial because even though we don’t usually register a company by making ourselves worst, sometimes problems can arise. This model is not for everyone. A university degree is required. We must have a school as our leader and be members of the school. We know that the only way to reap all the benefits of a professional limited business is to fulfill the obligations.
We have made it clear: professional limited companies should be used whenever possible. It can also be done, but don’t worry, there are many posts to discuss it!
We’ve already mentioned some of the benefits of a professional limited company (SLP), throughout this text. They aren’t the only benefits of the professional limited company (SLP), but they are an important part of the legal structure. This happens in a professional limited firm of lawyers, architects, and in any other neighborhood community that is worth its salt.
We have already told you before that it is useful to look into a bit and that it is not a joke. While the cons may seem unbelievable at times, they are often not. Other times, it is impossible to reap the benefits of the pros. We have compiled a list of the best and worst pros, based on the law regarding professional limited companies. If it suits you, you can’t claim you weren’t aware!
We believe that the most important advantage to forming a professional limited corporation is its title. It is not only limited liability. It is truly amazing to be able to do so without putting our personal heritage at risk. It is impossible to cook all the meat by grace or unfortunate. We must know that we won’t see each other again on the streets in two days. It is a different story how each person handles it on a personal basis.
A partnership with other professionals can strengthen the client’s image. It’s not the same as going to an office of a freelancer rather than to a firm or study with many highly qualified professionals.
There are no limits on the number and type of partners. We don’t emphasize it as much because they can be many… but because it could be just one! Even if the entrepreneur is not included in the creation of the professional limited company you still have the opportunity to enjoy all the benefits. This, forgive us for saying so, is a great way to get ahead. It is possible to be autonomous without losing sight of the truth.
A professional limited company’s taxation is more favorable than that of a self employed person. It also costs less than a normal limited company, which can cost around 3,000$ and 600$ for incorporation expenses.
Credits with an SLP are easier than autonomous, and the image given is more trustworthy.
Companies in our country are highly regarded and can be benefited from legally. It would be a mistake to fail to do so.
We have said before that not all things that revolve around a professional limited business are good. There are also some negative aspects. Although we prefer the positives to win, it is useful for you to see what obstacles you might face.
First, it takes time to set up a professional limited business. It takes about a month to set up a professional limited company. If we need to start sooner, we can register as self-employed. Although the time required is approximately 40 days, it is not excessive in most cases. However, each case has its own circumstances. This could mean we must give up some of the advantages of the model we are able to discuss today but we can still bill ipso facto.
If there are more partners, they can have a right of first refusal’ on parts that other partners put up for sale. This can lead to problems when trying to recruit new investors. Problems can also arise if one partner gains a larger share of society than the other.
This society is not the best for hiring workers. It is not possible to do so immediately.
We don’t have to take on any debts due to the nature of this loan, but we could face problems if we need to borrow money from a bank. These entities don’t believe in limited liability and will likely ask for a personal guarantee to approve a loan. We know this is a huge setback but it’s not impossible.
Today’s post has stated that you need a university degree to start a professional limited business. It also requires that you be a member of a professional college. Although these are important requirements to formalize the process, they are not the only ones. Facilities must be earned as a rule. This was no exception.
You won’t have to search for them all on Google, so don’t worry. These are just a few of the reasons we leave them here. If you’ve been thinking about starting a business for some time, you’ll know right away if this model of society will work for you.
It is mandatory to register the company’s nomenclature in the Central Mercantile Registry. However, this is only one type of company that requires it.
Next, you will need to create the model of the statutes for the professional limited company. They govern every society, so we can’t be less!
We will need to open a bank account in the company’s name after (or before). This is where the initial capital of your organization, which must not exceed $3,000, will be entered.
These three items will allow us to obtain our public deed in front of a notary. This will formalize the formation of our professional limited business, but we won’t be able yet to operate.
Now is the right time to settle the Tax on Patrimonial Transmissions & Documented Legal Acts. You can see that the 40 days it took to get started wasn’t random. We are halfway there!
Next, we need to request an appointment at the Treasury. We can access everything faster from our computer if our digital certificate is up-to-date. Our objetive? Get your tax identification number (NIF), and register in both the Economic Activities Tax or in the Census Declaration. It would be much less.
This is when we need to go back to Mercantile Registry but this time to the province where we will be locating our economic activity.
The final thing that we need to do is get the definitive Tax Identification number of our company. Then, we will be able to have a limited partnership. Congratulations! Congratulations! Congratulations!
Only thing left is to register members in the RETA. It will also be necessary to obtain an opening license for employees and register them with Social Security.
This and a cake are all you need to decide if you can benefit from what we have to say to you today. If so, get to work. Although we love being of service to you, it is obvious that our limited professional societies have allowed us to do more than we could with this limited resource.