Types of companies

To start a business, there are different modalities in which the company or society adjusts, from the moment of registration.

The definition of the type of company takes into account the size of the business, from its creation, and can change as it adjusts to other types.

The registration must be done carefully, because the way in which the company is registered is what defines the obligations that must be followed, especially with regard to taxes.

The main existing types are:

  • Individual Entrepreneur (IS);
  • Individual microentrepreneur (MEI);
  • Individual Limited Liability Company (EIRELI);
  • Simple Society (SS);
  • Business Limited Company (Ltda)
  • Limited Company (SA);

Next, understand the characteristics of each type of existing company, for entrepreneurs who want to develop the business as a sole proprietor or in companies.

Types of companies for individual entrepreneurs.

Individual Entrepreneur – IE

The IE is the category for companies that carry out their activities with a single owner, who has unlimited responsibility over him, which implies his personal finances with those of the company.

To set up a company in this category, the activities must be exclusively business, and not just intellectual and autonomous, as in the case of doctors or artists, for example.

It is possible for the sole proprietor to check if it is possible to fit into a more advantageous option, such as a MEI or an EIRELI, which we discuss in the following topics.

Individual microentrepreneur – MEI

The MEI is a category created in recent years by the Brazilian government, to facilitate the recognition of professionals who fall into this category.

To register as MEI, the individual entrepreneur can have an annual turnover of a maximum of R $ 81 thousand, in addition to having only one employee.

This type of business offers the entrepreneur the possibility of collecting taxes in a unique way, through Simples Nacional.

Individual limited liability company – EIRELI

For individual entrepreneurs who want to have their own business and at the same time limited liability only in the business, it is possible to form an EIRELI.

The business is required to start with a capital of at least 100 times the current minimum wage in the period.

This is the best type for those who plan to be the sole owner of their own business and still have their personal finances separate from the business.

Types of trade associations

Simple Society (SS)

An association consists of two or more members who share control of a company. This simpler type is common when professionals who carry out the same activities meet in the same place, as is the case in medical offices, for example.

The liability of the partners, in this type of association, is unlimited, which may involve their personal finances in the business. However, it is possible to formalize a limited liability company, known as Sociedade Simples Ltda.

Simple companies are registered at the Civil Registry Office of Legal Entities, for companies formed for intellectual, scientific, artistic or literary activities, which do not constitute the element of the company.

Business Limited Company (Ltda)

This is the correct company for those who form a company, which consists of activities for the production of goods or services, registered in the Commercial Registry.

The formation of the company occurs with the investment and participation of each partner, who has their shares divided into quotas.

Financial liabilities are always limited to the company’s equity and are included in bankruptcy law.

Limited Company (SA)

A corporation, better known as SA, is a kind of corporation, with the presence of shareholders, because the capital is divided into shares.

The SA company can be considered publicly traded, when the shares can be sold to anyone, or closed when it is only possible for internal shareholders or partners.