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FORM OF ENTERPRISE

Forms of enterprise (legal form)

Forms of enterprise
Ondernemingsvormen en rechtsvormen
What forms of enterprise are there? And what are the advantages and disadvantages of these legal forms? You can read more about them here.

Which company form suits your business? We advise start-ups in choosing the right legal form. We can also help convert the legal form (conversion from one-man business to private limited company) if necessary. Often, the choice of legal form is based on tax advantages. However, it is also wise to consider other aspects, such as private liability. We would be happy to advise you on the possibilities.

Various legal forms

When choosing a particular legal form, such as sole proprietorship, general partnership (GP), private limited company (LLC/PLC) or public limited company, the entrepreneur weighs up the pros and cons of the various business forms. Aspects such as starting situation, costs, tax and legal consequences also play a role.

Natural forms of enterprise

The biggest risk of companies with a natural form of enterprise is that the law holds the entrepreneur fully liable for all liability that rests on the company. This is also known as 'joint and several liability'. If something goes wrong on behalf of the company, the entrepreneur is 100% liable for the debt, eventually even including his private assets. So these are things you should pay close attention to when choosing a natural company form. The different natural company forms you can choose from are:

  • One-man business
  • Partnership
  • General partnership (GP)
  • Limited partnership


As a start-up company, you are eligible for tax breaks - subject to conditions. Ultimately, this results in less tax. Think of self-employed deduction, start-up deduction and SME profit exemption. We are happy to prepare income tax returns for entrepreneurs.

Incorporated enterprises

You can also opt for a legal entity form. The owners are separate from the company and, in principle, are not liable for its actions. It is also common for entrepreneurs to want to convert the one-man business (or general partnership) into a private limited company. We help draw up the right contribution documents for this. There are several private company forms to choose from:

  • Limited Liability Company (LLC)
  • English Limited (Ltd)
  • Public limited company
  • Partnership
  • Association and foundation

 

Different tax rules apply within these forms of enterprise. One often starts with an one-man business (or general partnership) and if sufficient profit is made, it is fiscally interesting to convert the legal form into a private limited company (holding structure). Also, when more risks are taken (staff, financing or renting) it is common to opt for a private limited company because of liability risks.

Which legal form to choose?

We can advise on which legal form is most suitable for you. Together, we will map out the pros and cons of the various legal forms and determine what best suits your business. Make an appointment and find out what we can do for you.

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