{"id":7377,"date":"2022-04-25T14:43:12","date_gmt":"2022-04-25T12:43:12","guid":{"rendered":"https:\/\/b-plannow.com\/?p=7377"},"modified":"2025-03-03T11:19:44","modified_gmt":"2025-03-03T10:19:44","slug":"corporate-forms-what-they-are-and-how-to-choose-the-most-suitable-for-you","status":"publish","type":"post","link":"https:\/\/b-plannow.com\/en\/corporate-forms-what-they-are-and-how-to-choose-the-most-suitable-for-you\/","title":{"rendered":"Corporate forms: what they are and how to choose the most suitable for you"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_87 ez-toc-wrap-center counter-hierarchy ez-toc-counter ez-toc-custom ez-toc-container-direction\">\n<nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/b-plannow.com\/en\/corporate-forms-what-they-are-and-how-to-choose-the-most-suitable-for-you\/#Italian-corporate-forms-what-are-they\" >Italian corporate forms: what are they?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/b-plannow.com\/en\/corporate-forms-what-they-are-and-how-to-choose-the-most-suitable-for-you\/#Pros-and-cons-of-the-most-common-corporate-forms\" >Pros and cons of the most common corporate forms<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/b-plannow.com\/en\/corporate-forms-what-they-are-and-how-to-choose-the-most-suitable-for-you\/#More-%E2%80%9Cconvenient%E2%80%9D-company-forms\" >More &#8220;convenient&#8221; company forms<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/b-plannow.com\/en\/corporate-forms-what-they-are-and-how-to-choose-the-most-suitable-for-you\/#Which-company-form-to-choose\" >Which company form to choose<\/a><\/li><\/ul><\/nav><\/div>\n<p>Among the many knots that you must necessarily untie when you set out to embark on a new professional adventure on your own, one of the most intricate is the one concerning the various <strong>corporate forms<\/strong> you can choose from. This particular area, in fact, has innumerable implications, not only organizational but also and above all fiscal and legal.<\/p>\n<p>Choosing the right corporate form for your business is therefore <strong>essential<\/strong>. Do not underestimate this step and, indeed, investigate every aspect: do you know what the choice of the company form depends on? What are the corporate forms envisaged in Italy? Do you know the pros and cons of the most common corporate forms? Which are the most convenient and, above all, why? It is time to answer all these questions.<\/p>\n<p>First of all, it must be clarified that the choice of company form is linked to several factors, the most important of which are the <strong>nature of the business<\/strong> you undertake (i.e., specifically, its complexity and growth potential) and the <strong>level of risk<\/strong> that you are willing to run. The <strong>purpose of the company<\/strong> is another aspect that you must not underestimate when you are about to decide which company form to choose.<\/p>\n<p>When starting a new business you can venture into the new business alone or start with one or more partners. In this regard, you must know that, even if you have to choose to start as a sole proprietorship and, therefore, to take on all the costs and risks independently and completely, as your turnover grows you can always change structure, in order to better protect your personal assets and access loans and financing more easily. Despite this, your initial choice is fundamental: it is necessary, in fact, to start from a company form that is as suitable as possible for the present scenario.<\/p>\n<p>Knowing better what are the corporate forms that can be adopted in Italy will make the choice easier for you.<\/p>\n<p>&nbsp;<\/p>\n<h2><span class=\"ez-toc-section\" id=\"Italian-corporate-forms-what-are-they\"><\/span>Italian corporate forms: what are they?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>The aforementioned <strong>sole proprietorship<\/strong> is a particular organizational structure which provides that the business is managed entirely by the owner, <strong>personally taking on risks and charges<\/strong>.<\/p>\n<p>When the company is larger, it is usually structured in <strong>limited companies<\/strong>.<\/p>\n<p>The <strong>freelance professional<\/strong> is, on the other hand, a self-employed worker who provides services, usually intellectual, to various clients and on various projects.<\/p>\n<p>Among the various types of companies it is also possible to identify the <strong>family business<\/strong> (i.e. a company owned and managed by the members of a family, even over several generations), and the <strong>non-profit company<\/strong> (they are non-profit entities who carry out activities of general interest and social utility without the profit being divided among the shareholders).<\/p>\n<p>With regard to the legal area, it is the <strong>Civil Code<\/strong> that regulates corporate forms in Italy, while the <strong>TUIR<\/strong> regulates the tax area.<\/p>\n<p>The first fundamental distinction you need to pay attention to is that between <strong>partnership company<\/strong> and the aforementioned <strong>limited company<\/strong>. Within these two categories, then, it is possible to identify other more specific sub-categories (<strong>cooperatives<\/strong>, as we will see below, represent a category with separate rules).<\/p>\n<p>Specifically, partnership companies include:<\/p>\n<ul>\n<li><strong>simple partnership<\/strong> &#8211; societ\u00e0 semplice (Ss);<\/li>\n<li><strong>general partnership<\/strong> &#8211; societ\u00e0 in nome collettivo (Snc);<\/li>\n<li><strong>limited partnership company<\/strong> &#8211; societ\u00e0 in accomandita semplice (Sas).<\/li>\n<\/ul>\n<p>Limited companies, on the other hand, include:<\/p>\n<ul>\n<li><strong>joint-stock company<\/strong> &#8211; societ\u00e0 per azioni (Spa);<\/li>\n<li><strong>limited liability company<\/strong> &#8211; societ\u00e0 a responsabilit\u00e0 limitata (Srl);<\/li>\n<li><strong>partnership limited by shares<\/strong> &#8211; societ\u00e0 in accomandita per azioni (Sapa).<\/li>\n<\/ul>\n<p>&nbsp;<\/p>\n<h2><span class=\"ez-toc-section\" id=\"Pros-and-cons-of-the-most-common-corporate-forms\"><\/span>Pros and cons of the most common corporate forms<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>If you decide to opt for a <strong>sole proprietorship<\/strong> you will benefit from several <strong>advantages<\/strong>: this type of company is easy to set up and its birth will require a minimum capital. Plus, you won&#8217;t have to <strong>file<\/strong> a balance sheet every year (but only <strong>prepare<\/strong> your tax return), you will have slightly <strong>lower tax management costs<\/strong> and will be able to withhold profits (after tax). This choice, however, also has some &#8220;<strong>cons<\/strong>&#8220;: you will be personally responsible for every choice made as well as for all debts incurred during the business, even with your personal assets. Furthermore, with a sole proprietorship it is even more difficult to raise capital.<\/p>\n<p>As a<strong> freelance professional<\/strong> you have no registration obligations with the Chamber of Commerce but only the opening of the VAT number, except for fulfilments related to belonging to orders or registers.<\/p>\n<p>This form allows a more agile organizational management, allowing you to work practically anywhere, even from home. If you choose this solution, you will also have the possibility to organize schedules and work volumes as you wish. Furthermore, start-up costs are minimal. As with the sole propriertorship, the professional is also solely responsible for their own financial management and it is possible that the income is irregular. Pay attention to managing the balance between life and work, which is particularly delicate for this professional figure.<\/p>\n<p>Even in the case of a <strong>family business<\/strong>, potential conflicts represent an important &#8220;cons&#8221;, as they are more difficult to solve. That said, however, in this case the values are generally common and there is also more understanding and trust. Not only that: another advantage that should not be underestimated is that the profits remain in the family.<\/p>\n<p>With a <strong>non-profit company<\/strong> you can access subsidies and tax exemptions and you have a noble cause to pursue. However, the personal reward, from an economic point of view, is limited. In addition, competition for funds is high and donations are inevitably tied to people&#8217;s generosity.<\/p>\n<p>As for the <strong>simple partnership<\/strong> &#8211; societ\u00e0 semplici (Ss) you must know that it is not suitable for commercial activities. It is no coincidence that only the other types of partnership companies and limited companies mentioned in the previous paragraph are also defined as commercial companies, as they carry out activities aimed at the production and exchange of goods and services.<\/p>\n<p>The <strong>general partnership<\/strong> &#8211; societ\u00e0 in nome collettivo (Snc) is a company form in which the partners are indefinitely jointly and severally liable for the social debts. Whoever has a credit has the possibility of attacking the company&#8217;s assets first and, if this is not enough, also the personal assets of the shareholders. It is therefore a form of company that stands out for its high risk, as the shareholder may have to answer for corporate debts with his own personal assets.<\/p>\n<p>The <strong>limited partnership company<\/strong> &#8211; societ\u00e0 in accomandita semplice (Sas) provides for the presence of two particular figures: the limited partner (i.e. a shareholder with limited liability based on the share held and who does not administer the company) and the general partner (a shareholder who is indefinitely and jointly liable and who actually takes care of the administration of the company).<\/p>\n<p>The <strong>limited liability company<\/strong> &#8211; societ\u00e0 a responsabilit\u00e0 limitata (Srl) is a company that responds only to its share capital, the amount of which is generally defined at the time of incorporation. The shareholders who make up this particular company form are not involved from a financial point of view, except within the limits of the capital subscribed by them. In this type of company, the autonomous assets are divided into shares.<\/p>\n<p>In the <strong>joint-stock company<\/strong> &#8211; societ\u00e0 per azioni (Spa), the capital is divided into shares which incorporate ownership and voting powers at the meeting. As for the Srl, the assets are autonomous and distinct.<\/p>\n<p>A <strong>partnership limited by shares<\/strong> &#8211; societ\u00e0 in accomandita per azioni (Sapa) provides for the same types of shareholders as the Sas but complies with the same rules provided for the Srl.<\/p>\n<p>As mentioned, the<strong> cooperative<\/strong> represents a separate corporate form: this specific type is non-profit and arises from the principle of mutuality and solidarity, to serve the same members that compose it.<\/p>\n<p>Also speaking of business management methods,<strong> franchising<\/strong> deserves a mention, as there is no need to develop an original idea for your business. The business risk is also lower and the \u201cparent\u201d brand provides a proven business model, as well as support and management. However, for many, always having to give an account to the franchisor is a &#8220;cons&#8221;, because it is considered a big brake on one&#8217;s self-realization.<\/p>\n<p>&nbsp;<\/p>\n<h2><span class=\"ez-toc-section\" id=\"More-%E2%80%9Cconvenient%E2%80%9D-company-forms\"><\/span>More &#8220;convenient&#8221; company forms<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>Defining a priori which is the most convenient company form is a difficult undertaking and, above all, it can be misleading, because the discussion often boils down to the sterile search for the best company form to pay less taxes. You should know, however, that in reality there is no better company form than others, but only the one that best suits your specific needs.<\/p>\n<p>The choice, as mentioned, depends on several factors, one of the most important being <strong>the degree of risk you are willing to take<\/strong>. In this regard, point out that in partnerships, the automatic extension of a possible bankruptcy of the company to the shareholders is envisaged, while in joint-stock companies the shareholders are not involved. Think carefully about this but don&#8217;t let it scare you: remember that, as <strong>Mark Zuckerberg<\/strong> would tell you,<\/p>\n<blockquote><p>&#8220;If you risk nothing, you risk everything&#8221;.<\/p><\/blockquote>\n<p>To make the best choice, also <strong>look around<\/strong>: most entrepreneurs opt to set up an Srl, in order to ensure the separation of the company&#8217;s assets from that of the shareholders. This choice offers you the advantage of being able to divide up the capital as you wish and to modify it in a simple way, to exchange and sell shares. This is a fairly expensive corporate form in the initial stage, but also in terms of managing corporate accounting.<\/p>\n<p>Do you know that there is also a company form called <strong>simplified Srl<\/strong>? Introduced in 2012, the <strong>simplified limited liability company<\/strong> &#8211; societ\u00e0 a responsabilit\u00e0 limitata semplificata (Srls) can represent a convenient solution for projects of short duration or which are not expected to undergo changes in the future. By choosing this particular company form you will be able to enjoy some tax breaks at the time of its establishment and exemption from stamp duty, secretarial fees and notary costs.<\/p>\n<p>A Srls, however, has some limitations: the share capital (which must be paid at the time of incorporation) must be less than 10 thousand euros, the statute is rigid and cannot be modified, the shareholders can only be natural persons and it is more complicated to apply for financing, loans or credit lines. Furthermore, the savings that can be ensured at the outset risk being nullified by the costs that may be necessary in the event of any changes in the company. Therefore, this shape is not a particularly cost-effective solution for long-term projects.<\/p>\n<p>&nbsp;<\/p>\n<h2><span class=\"ez-toc-section\" id=\"Which-company-form-to-choose\"><\/span>Which company form to choose<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>Now that you know what company forms are required by law in Italy, their specific characteristics and, above all, their advantages and disadvantages, you can proceed more wisely to choose the best form for your needs.<\/p>\n<p>Pay attention to the tax and legal implications that each form has, but <strong>do not think only in terms of risk<\/strong>, rather <strong>think about the opportunities<\/strong> that your decision can offer you: the choice of the best corporate form for you, remember, is also linked to the purpose of your activity, its nature and its particular organization, its volume and its growth potential.<\/p>\n<p>&nbsp;<\/p>\n<p><strong>Do you want to read all the articles related to the stage your startup is in?<\/strong><\/p>\n<ol>\n<li><a href=\"https:\/\/b-plannow.com\/en\/how-to-start-a-successful-startup-and-make-it-work\/#Take_the_plunge\"><strong>Take the plunge<\/strong><\/a><\/li>\n<li><a href=\"https:\/\/b-plannow.com\/en\/how-to-start-a-successful-startup-and-make-it-work\/#Take_the_first_steps\"><strong>Take the first steps<\/strong><\/a><\/li>\n<li><a href=\"https:\/\/b-plannow.com\/en\/how-to-start-a-successful-startup-and-make-it-work\/#How_to_start_a_startup\"><strong>How to start a startup<\/strong><\/a><\/li>\n<li><a href=\"https:\/\/b-plannow.com\/en\/how-to-start-a-successful-startup-and-make-it-work\/#How_to_grow_a_startup\"><strong>How to grow a startup<\/strong><\/a><\/li>\n<\/ol>\n","protected":false},"excerpt":{"rendered":"<p>Among the many knots that you must necessarily untie when you set out to embark on a new professional adventure on your own, one of the most intricate is the one concerning the various corporate forms you can choose from. This particular area, in fact, has innumerable implications, not only organizational but also and above [&hellip;]<\/p>\n","protected":false},"author":3,"featured_media":17691,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[69],"tags":[78],"class_list":["post-7377","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-take-the-plunge","tag-guides-and-regulations"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v28.4 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Corporate forms: which are they and which to choose | B-Plannow<\/title>\n<meta name=\"description\" content=\"In Italy there are many corporate forms but which are the most convenient for your business idea? 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