STARTING A BUSINESS, SUPPORT, CONSULTATION

A small partnership is a private legal entity with limited liability. This means that members are not liable with their property for the unfulfilled obligations of the small partnership. A small partnership can be established by no more than 10 natural persons (there can be one founder). A small partnership can carry out any activity not prohibited by law. Although there is no requirement to have a minimum authorized capital, members pay contributions, and profits are distributed in proportion to the size of the member's contribution. It is established electronically through the self-service system of the Center of Registers.

Advantages:

+ Limited liability of members – if the business fails, members risk only their own contributions, protecting their personal assets;
+ No minimum authorized capital requirement applies;
+ Possibility to voluntarily withdraw from the business (to leave by withdrawing the contribution or transferring the member's rights to other persons).

Disadvantages:

- Only a natural person (up to 10 persons) can be a founder/member;
- Since there is no clear procedure for voting and profit distribution, it may be more difficult to resolve disputes between members;
- Accounting is simpler than UAB only in some cases (e.g. when there are no employees or VAT payer status).

Individual activity according to the certificate

Taxes are paid on the income/profit actually received.
A more flexible form that does not have a strict list of permitted activities.

Individual activity under a business license

A fixed fee is paid for the selected period (certificate/certificate).
Business license fees in Utena district: PRICES

Advantages:

+ No need to contribute funds to the authorized capital (for comparison - the minimum authorized capital of a UAB is 1000 EUR);
+ Easy to withdraw profits – the owner of the private limited company can withdraw money or other assets from the private limited company for his personal needs at any time;
+ The owner can work alone in his own company without concluding an employment contract, therefore paying lower taxes. If necessary, other persons can be employed;
+ Private limited company can be transformed into UAB;
+ Tax benefits: if the average number of employees does not exceed 10 people and the income for the tax period does not exceed EUR 300,000, a preferential corporate tax rate of 5% is applied instead of the usual 15% rate.

Disadvantages:
- If the business is unprofitable, the owner is liable with his/her own assets for the unfulfilled obligations of the private limited company;
- Only one person can be the owner of a private limited company; he cannot establish a private limited company together with partners;
- New shares cannot be issued to raise funds.