Business Owners & Independent Contractors
Limited Liability Companies
The share capital of a public limited company (hf) is divided into two or more shares, but the share capital of a private limited company (ehf) may be owned by one person or by more than one shareholders. A publicly owned company (ohf) is always owned by the state or by more than one shareholders.
Private limited company/public limited company/publicly owned company
No member of a limited company is personally liable for all its obligations, and what financial liability they have is limited to their capital contributions.
The public limited company as a corporate form is most suited to the larger and more extensive types of operation that are intended for listing on a stock exchange.
There is no maximum limit to the share capital or the number of shareholders of a private limited company, and therefore this corporate form is equally suitable for large and small companies.
A publicly owned company is wholly owned by the state, directly or indirectly. The number of shareholders may be one or more than one.
Public limited companies, private limited companies and publicly owned, limited companies are by law obligated to keep records of accounts and must use double-entry accounting.
Private limited companies, public limited companies and publicly owned companies must be registered within a certain time limit with the register of limited companies. An unregistered company can neither obtain rights nor undertake obligations.
Any company that accounts for a payroll must be registered on the Directorate of Internal Revenue or the relevant regional tax director's list of employers who pay withholding tax.
The principals of a private limited company must have their remuneration calculated, cf. "Guidelines on calculated remuneration".
When a private limited company of one person, a private limited company of more than one person, a public limited company or a publicly owned limited company is formed, the articles of incorporation or memorandum of association, and the articles of association or minutes from the initial meeting, must be submitted to the Directorate of Internal Revenue.