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Autónomo or Sociedad Limitada, what is the difference?

8/15/2019

 
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Autonomo? Or Sociedad limitada? - www.intro-law.com
From a legal point of view, the main difference is that in a Sociedad Limitada (similar to a limited liability company) the owners are liable only with the amount they have invested in the company, while an autónomo (sole proprietorship) is liable with the total amount of his personal assets, including property, money on bank account, car, etc. However, there are also some exceptions regarding the liability, because an administrator or owner of a limited liability company could still be responsible for personal assets in case of doing something illegal with the company, neglecting taxes or similar. On the other hand, a sole proprietorship could also limit the amount for which he is liable by choosing a special form of a sole proprietorship, which excludes the possibility for creditors to claim his home (to a certain amount). 

Still, there are many other differences between these two business forms, such as the structure of the company, how much you can earn in the company, taxation and other matters as expenses. In general, one could conclude that a Sociedad Limitada is a good choice for those who aim to do business together with partners or would like to limit their liability in the company, while sole proprietorship is a very common and attractive choice for any freelancer that is planning to start a business in Spain, without aiming to share company profits with other partners or without a certain need to limit the liability against creditors.

Our INTRO™ multilingual lawyers can assist you in choosing the right business form, forming a company in Spain or incorporations for international structures.

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