EIRL – The current status of entrepreneurs
As of May 15, 2022, a unique status of the sole trader is in effect. It puts an end to the possibility of creating a limited liability company (EIRL) and reduces the formalities attached to the EIRL.
The reform creates a unique status of sole trader, the EIRL scheme is being put on hold. It is therefore no longer possible to create an EIRL since February 15, 2022. However, current and pre-existing EIRLs will retain this status. However, it is necessary to draw up a declaration of the taking over of existing affected assets and to lodge a descriptive statement.
The new status of individual entrepreneur is also different from EIRL because it no longer obliges the entrepreneur to open a separate bank account in order to carry out his business. However, this does not apply to traders and micro-entrepreneurs with a turnover of more than EUR 10 000 for two consecutive years.
The goal is to protect the entrepreneur’s personal assets by making them elusive to professional creditors. It is however possible for the individual entrepreneur to waive the benefit of this separation of assets, on written request of a creditor.
The entrepreneur’s professional assets include the property, rights, obligations and securities held by the entrepreneur and used for his professional activity:
- Tangible or intangible assets
- Movable goods such equipment and tools
- Immovable property used for the business, including that part of the sole trader’s principal residence used for business purposes.
- Cash funds, any cash held at the place where the professional activity is carried on, the sums entered in the bank accounts dedicated to that activity and the sums intended to cover current expenditure relating to that activity.
If you wish to find out more, do not hesitate to contact us via telephone +33 (0) 1 53 93 94 20 or by mail at [email protected]. Our team of experts will happily assist you with any queries you might have.
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