Establishing a Sole Trader in Argentina

Updated on Friday 23rd July 2021

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Sole Shareholder Corporation companies in Argentina are what we know elsewhere as Sole Trader and are perfect for individuals who want to go into business for themselves. However, the process of company formation in Argentina is not as simple as in other countries. So having the right company will be crucial for you to navigate your way through the laws and paperwork. We are here to help you.
 
Individuals who successfully go through the company formation stages to establish a Sole Shareholder Corporation are usually engaged in consulting or similar services.
 
These professionals open a company in Argentina of this type without the need to comply with additional requirements. So it is quite simple for our lawyers to advise you if you want to establish one of these companies and even with your tax planning after incorporating a sole trader.
 

The pros of a Sole Shareholder Corporation in Argentina

 
This type of company has not become a favorite of those who come to do business in Argentina by chance. Once you finish setting up a company of this kind in Argentina, you start to discover the advantages it has:
 
  • This type of company allows any person to separate a part of his patrimony specifically to a commercial activity without the risks of that commercial activity affecting his entire patrimony because the liability is limited to that portion of the patrimony he designated for the company.
  • The capital stock required for incorporation is just over US$620.
  • The government fee you must pay is less than US$75.
  • It can be created within 24 hours if all the necessary documentation is in order.
 
If you need more information about the advantages of this type of company or about anything about the company formation process in Argentina, we are here to help you. Our experts can also help you open a bank account for your sole trader.
 

The disadvantages of a Sole Shareholder Corporation in Argentina

 
Although this type of company is one of the most popular when we talk about Argentina company formation, you should know that Sole Shareholder Corporations have a major weakness that you should pay special attention to avoid complex problems to solve even with the best legal experts.
 
If you decide to incorporate a sole trader in Argentina, you should know that you, as the sole shareholder, will face some possible difficulties. That means that if the company's capital cannot cope with any debt, your company may go into insolvency very quickly if it is a complex problem, which is an advantage of the limited liability company. Moreover, Argentina is not the friendliest place to do business nor a particularly free economy.
 
To know what to do in case of any unforeseen event, you can talk to some experts in company formation in Argentina so that you can anticipate any unexpected event.
 

How complicated is it to open a sole trader in Argentina?

 
You have to follow the same steps to open such a company in Argentina. The main difference is in the integration of the capital: if you incorporate a sole proprietorship, the capital stock must be fully integrated at the time of incorporation. For example, if the company will have a capital of ARS$100, that money must be deposited in the Banco de la Nación Argentina at the time of incorporation.
 
The documentation you will need to incorporate a Sole Shareholder Corporation in Argentina is as follows:
 
  • The incorporation form.
  • A form issued by the Argentine tax authority.
  • Incorporation agreement.
  • Accreditation of capital contributions.
  • Proof of publication of edicts.
  • Professional prequalification opinion.
  • Documentation that accredits the constitution of the guarantee of the administrators.
 
If you need to know the details and the rest of the documentation you need to set up a company in Argentina, we can clarify your doubts and accompany you through the whole process. Our experts can also help you with a virtual office for your company.
 

How do individual taxes work in Argentina?

 
After you have gone through the process of company formation in Argentina, it is time to start the tax planning. There are four main issues you should know about taxes for individuals in Argentina.
 
  1. Argentinian residents are taxed on their global income.
  2. Non-residents and foreign beneficiaries are only taxed on their Argentine source income.
  3. Both residents and non-residents are taxed at rates ranging from 5% to 35%.
  4. There are special taxes applicable in securities, interest, and real estate gains.
 
The Argentine tax system is not very friendly for people who want to establish a sole trader in Argentina, so having the right advice becomes a necessity in this jurisdiction.
 
Our experts can help you with everything you need to open a company in Argentina and tax planning afterward. Do not hesitate to contact us to clear out your doubts!