Sole trader or company? How to choose in Germany, France, Spain, Denmark and Greece
In most European countries the choice is the same as in the UK - start on your own name for the simplest, cheapest start, or form a company to protect your personal assets and look more established. The names change (Einzelunternehmen or GmbH in Germany, micro-entreprise or SASU in France, autonomo or SL in Spain, enkeltmandsvirksomhed or ApS in Denmark, sole trader or IKE in Greece) but the trade-off does not. Many founders start on their own name and form a company once the business is proven.
The UK question “sole trader or limited company?” exists everywhere in Europe, under different names. The trade-off is the same: start on your own name for speed and low cost, or form a company to separate the business from your personal assets. Here is how it looks in the five countries Corey has researched rule books for, with the UK version as the reference.
The choice, side by side
| Country | On your own name | Private company | Minimum capital | Where you register |
|---|---|---|---|---|
| UK | Sole trader | Limited company (Ltd) | None in practice | HMRC, or Companies House for a company |
| Germany | Einzelunternehmen or Freiberufler | GmbH, or the UG | GmbH €25,000; UG from €1 | Trade office or tax office; company via notary and the Handelsregister |
| France | Micro-entreprise or EI | SASU or EURL | From €1 | Guichet Unique (INPI) |
| Spain | Autonomo | Sociedad Limitada (SL) | From €1 | Tax agency and social security; company via notary and the Mercantile Registry, or online through CIRCE |
| Denmark | Enkeltmandsvirksomhed | ApS | DKK 40,000 | Virk, for a CVR number |
| Greece | Sole proprietorship | IKE | From €1 | Tax authority (AADE); company through GEMI |
Figures checked on 27/10/2026. Rules change, so confirm them with a local accountant before you commit.
Germany
Most people start as an Einzelunternehmen (registered with the local trade office) or, for many knowledge professions, as a Freiberufler registered only with the tax office. Small businesses can use the Kleinunternehmer scheme and skip charging VAT while turnover stays at or below €25,000 in the previous year and €100,000 in the current one.
A GmbH needs €25,000 of share capital, at least €12,500 paid in, and is formed through a notary and the commercial register. The UG (haftungsbeschränkt) is the same company with as little as €1 of capital, but it must keep a quarter of each year’s profit until it reaches €25,000.
Step by step: register a company in Germany.
France
The micro-entreprise is the quickest start: simple bookkeeping, and social charges calculated as a percentage of turnover. For 2026 to 2028 it is open while turnover stays at or below €83,600 for services or €203,100 for selling goods. Above that, or when you want liability protection or to bring in partners, founders usually form an SASU (one-person simplified company) or an EURL (one-person limited company). Everything is registered through the Guichet Unique.
Step by step: register a company in France.
Spain
Registering as an autonomo is the usual start: you sign up with the tax agency and the social security system, and new autonomos pay a reduced flat-rate contribution in their first year. A Sociedad Limitada (SL) can now be formed with €1 of capital, but until capital and reserves reach €3,000 it must keep 20% of profits in reserve and the partners stay liable for the shortfall. Foreigners also need an NIE before they can register either.
Step by step: register a company in Spain.
Denmark
An enkeltmandsvirksomhed (sole proprietorship) is free to register on Virk and gives you a CVR number in minutes. An ApS needs DKK 40,000 of capital, which can be paid in cash or in assets, and is registered on the same site. There is no longer a low-capital company form; the IVS was abolished in 2019.
Greece
A sole proprietorship is registered with the tax authority (AADE), and with GEMI if it is commercial. An IKE (private company) can be formed with €1 of capital through the GEMI one-stop shop, and is the usual choice for a founder who wants a company.
How to decide
The questions are the same in every country:
- Do you need liability protection now? If the work carries real risk, or you will sign large contracts, a company protects your personal assets.
- What will the admin cost you? A company files accounts and its own tax returns, and usually needs an accountant. Starting on your own name keeps that load light while you test the idea.
- Who are your customers? Some larger clients and most investors prefer to deal with a company.
- What do the numbers say? Above a certain profit a company usually pays less tax, but the crossover depends on the country and how you pay yourself. Have an accountant model it.
Not sure yet? Start on your own name, test the idea and switch when the business is proven.
Let Corey set it up
Corey is a free AI co-founder for solopreneurs and startups, inside Claude. Tell it your country and your plans with the Set up the business prompt, and it explains the options where you are, prepares the details and the forms, and keeps the deadlines afterwards. You check, sign and submit. Get Corey free. You need a paid plan on your AI app, such as Claude Pro.