One of the most frequently asked questions we receive from entrepreneurs who start a business in Europe is what company type we recommend they open. While we have already described the advantages of opening a subsidiary or branch office, today we will be comparing being a sole trader versus opening a LTD company in Slovenia.
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Data d.o.o. has been offering support to foreign citizens with their business in Slovenia. In addition to company registration services, we also provide professional accounting services. We also have specialized legal advisors that support business owners with every aspect of business Slovenian legislation. Also, you can follow us on Facebook.
Who can become a sole trader in Slovenia?
Sole trader or sole proprietor is a company type that is connected to a natural person. It means that an individual can conduct a business activity under their own name. This person bears liability for the business conduct with all their personal assets. In Slovenia, every EU citizen can register as a sole trader. As for non-EU citizens, they can register as sole traders only after 1 year of living in Slovenia.
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Comparison between sole trader and LTD company
LTD or limited liability company is the most common company type which entrepreneurs register in Slovenia. It is also a company type that foreigners of all nationalities can register without prior residence in Slovenia. Compared to sole trader, the LTD company only bears the responsibility for business conduct with the amount of share capital. The minimal amount of share capital with LTD company is 7500 EUR and for sole trader you do not require any share capital.
With LTD company, you can have many shareholders who contribute to the company’s ownership. Whereas for sole trader, there are no owners as it is connected to the single individual who opened it. This is also visible with the name of the company. The sole trader holds the first and last name of the individual, while with the LTD company you can choose a fantasy name.
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Which of the company types is better?
Each of the company types has its advantages, depending on the business you are involved it. As a sole trader, you do not have to provide initial capital, but would have to bear all financial responsibility to debtors in case of disputes. Also in some cases, LTD company comes across as a more serious company than sole trader when presenting to banks or to clients. Each of the company types has also different tax implications. Here, it is best to consult a tax specialist who can advise you which company type is more suitable for your particular business. At DATA, we can definitely offer such consultation.
Are you planning to start your business in Slovenia? Contact DATA for full support!
If you do not know which of the choices is most suitable for your business do not hesitate to contact DATA d.o.o. for support! Send us an email to data@data.si. You can also call us on +386 1 6006 270, Viber/Whatsapp +386 40 530 718 or skype data.business7.
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