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Launching a business is not easy, especially because you have to choose between several legal forms. To differentiate the types of companies, two main categories exist: the capital company and the partnership. Whatever your project, it is therefore necessary that you can distinguish between each of these two companies. What are the advantages and disadvantages of each of these companies? What do you need to know first about the partnership and the capital company? This is what we will see together.

What is a partnership ?

The partnership places special emphasis on the partners and the purpose of their association. This is in particular what differentiates it from the capital company. More concretely, this social form of company only exists thanks to the trust that the partners have placed between them, since the latter are responsible for the debts of the company in a perfectly solidary manner. In other words, unlike a SARL (limited liability company), which limits the liability of the partners to their contributions to the share capital, the partnership entails an increased risk for each of them.

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This particularity of the partnership implies a somewhat particular operation, especially when it comes to making an important decision, since the unanimity of the partners is required. Similarly, in terms of taxation and taxation, the latter are individually subject to the income tax system. Among the most common partnerships, we find in particular the SCS limited partnership, the SNC general partnership and civil companies such as the SCI.

What is a capital company ?

As you will have understood, in a capital company, it is the financial participation of the partners which takes precedence over the simple association itself. All the elements that concern the person themselves are less important, knowing that they do not necessarily know each other. The contribution to the share capital takes precedence over other elements. Thus, the integration of a shareholder or a partner is done mainly on the basis of his contribution, which entitles him in return to shares or shares. Whether the share capital is made up of contributions in cash or contributions in kind, the creation of a capital company leads to the creation of assets specific to the company.

Within the capital company, as for an LLC, the liability of the partners is limited to their contributions to the share capital. In other words, if the company incurs debt, they will not be able to lose more than the amount they have injected into the company. Therefore, the risk is much lower than in a partnership. Finally, it should not be forgotten that a capital company is, by default, subject to corporation tax, and that only the company is taxed. Note, however, that income tax is a tax option that remains possible.

By Andrew T.

Andrew has grown in a little town in the south of France. After his first degree in digital communication, he went to UK - London to study SEO. But his heart fell in love with Branding and Marketing Strategies when he has started to work for one of the biggest Communication agency of England.

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