Unlike companies such as the SARL, the EURL, the SAS or the SASU, the sole proprietorship does not require any minimum share capital . Indeed, one of the particularities of this status lies in the fact that the entrepreneur and the company are one in legal terms: thus, the concept of share capital does not exist for a sole proprietorship.
This does not mean, however, that the entrepreneur does not need financial british student data resources to start his business. The contributions needed to launch the business can be used to cover the initial expenses, but they are not formalized in the form of share capital, as in a company.
This is also true for the auto-entrepreneur status (also known as micro-enterprise ) which is a simplified form of the individual enterprise.
A self-employed individual who does not have any share capital
The consequences of the lack of capital for individual businesses
The absence of share capital in a sole proprietorship has several consequences, both on a legal and administrative level.
Simplification of creation and administrative procedures
The fact of not having to constitute a share capital considerably simplifies the creation of the sole proprietorship. The entrepreneur does not need to deposit funds into a business account, which reduces the initial costs and lightens the administrative formalities. It also facilitates the social declaration and the tax declaration of the sole proprietorship , which do not require mention of share capital.
Did you know? Individual entrepreneurs and micro-entrepreneurs are not required to open a professional account to register their business, as they do not have any share capital to deposit. However, if their turnover exceeds €10,000 for two consecutive years, they will have to open a bank account dedicated to their activity, whether it is a classic or professional current account.
Access to finance and financial risks Impact on creditors
The lack of share capital in a sole proprietorship makes access to finance particularly difficult. Indeed, banks and creditors are often reluctant to grant loans, because the financial risk rests entirely on the entrepreneur's personal assets.
Furthermore, unlike companies that display clearly identified capital, the sole proprietorship does not have formalized equity , which makes it difficult to demonstrate its financial solidity . This situation can harm its credibility with partners and creditors, thus limiting its financing and collaboration opportunities.
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