The choice of legal status is a crucial step in creating a business in France. Among the most common forms, the Limited Liability Company (SARL) and the Simplified Joint Stock Company (SAS) each have advantages and disadvantages. This article aims to guide you in this decision by analyzing the main differences between these two structures.
1. General presentation
SARL
SARL is a form of company that is particularly suited to small and medium-sized businesses. It is characterized by relatively simple management and reinforced protection for partners. In fact, the liability of the partners is limited to the amount of their contributions.
SAS
SAS, for its part, is popular for its great flexibility. It allows partners to freely define the rules of operation of the company in the articles of association. This status is often chosen by businesses that anticipate rapid growth or want to attract investors.
2. Social capital
SARL
The minimum share capital for a SARL is fixed at one euro, just like for the SAS. However, it is common for LLCs to be formed with greater capital, to strengthen the credibility of the company.
SAS
SAS is distinguished by a great deal of freedom in the distribution of capital. Shares can be issued under a variety of conditions, making it easier for new investors to enter.
3. Governance
SARL
The management of an SARL is more rigid. It is managed by one or more managers, who must be natural persons. Decision-making power is often concentrated in the hands of managers, with limited participation by partners.
SAS
SAS offers incomparable flexibility in terms of governance. It may be headed by a president, but the statutes may also provide for other management bodies. This flexibility makes it possible to adapt the management structure to the specific needs of the company.
4. Social regime for managers
SARL
The majority manager of a SARL is affiliated to the regime for self-employed workers (TNS), which results in social security contributions that are often lower than those of employees, but with also lower social security coverage.
SAS
The president of the SAS, as well as other managers who are equivalent employees, are subject to the general social security regime. This status offers more comprehensive social protection, but involves higher social contributions.
5. Taxation
SARL
The SARL is subject to corporate tax (IS) or, under certain conditions, may opt for income tax (IR). The IR option is time-limited and reserved for family LLCs.
SAS
The SAS is automatically subject to corporate tax, but it can also opt for income tax under certain conditions, for a maximum period of five years.
6. Transfer of shares
SARL
The transfer of shares in a SARL is governed by strict rules. It always requires the agreement of the other partners, which can slow down and complicate the transmission.
SAS
The transfer of shares in a SAS is much more flexible. The articles of association may provide for pre-emption or prior approval clauses, but in the absence of such clauses, the transfer is generally free between partners, thus facilitating the entry and exit of investors.
7. Creation formalities
SARL
The formalities for creating an SARL are relatively simple but more rigid than those of the SAS. The statutes are governed by law, which limits the personalization of operating rules.
SAS
The creation of a SAS requires careful drafting of the statutes, in order to take full advantage of the flexibility offered by this statute. This stage can be complex and often requires the intervention of an expert to ensure the conformity and effectiveness of the statutes.
Conclusion
The choice between SARL and SAS will largely depend on the specificities of your project and your expectations in terms of governance, social regime and flexibility. The SARL will be better suited to entrepreneurs looking for a simple and protective structure, while the SAS will appeal to those who value flexibility and attractiveness for investors.
Before making your decision, let's talk together over coffee. Choosing the right legal status is a decisive step for the success of your business, so don't neglect this consideration.
