Do you want to start your own business? You might be considering a single-shareholder simplified joint-stock company (société par actions simplifiée unipersonnelle, or SASU). Or maybe you’ve heard that a single-shareholder limited liability company (entreprise unipersonnelle à responsabilité limitée, or EURL) can be a good option. But what are the key similarities and differences between these two types of sole proprietorships? This article provides a detailed comparison of SASUs and EURLs to help you decide which form is the best fit for your business.
What’s in this article?
- What is an SASU?
- What is an EURL?
- What do an SASU and an EURL have in common?
- What are the differences between an SASU and an EURL?
- EURL vs. SASU: A comparative table
- EURL or SASU: Which should you choose?
What is an SASU?
An SASU is a form of simplified joint-stock company (société par actions simplifiée, or SAS) that has just one shareholder. This shareholder can be an individual or a legal entity, such as a company or association. An SASU offers great flexibility in terms of company organization, management, and scalability; it’s a popular option among those who want to set up their own businesses.
You can find out more about this legal form in our article on SASUs.
What is an EURL?
An EURL is another single-person legal form for entrepreneurs who want to start their own businesses. This form is the sole proprietorship version of the limited liability company (société à responsabilité limitée, or SARL).
Unlike an SASU, an EURL is governed by France’s Commercial Code. The sole shareholder, whether an individual or a legal entity, benefits from this secure legal framework.
Find out more about an EURL form in our article.
What do an SASU and an EURL have in common?
Both an EURL and an SASU have a single shareholder. This means that decisions are made unilaterally, without a vote or quorum.
In both forms, the single shareholder can decide on the share capital of the company. Their financial liability is limited to the amount of their contributions.
An EURL and an SASU can both be converted into their multiperson legal forms—an SARL and an SAS, respectively—by increasing the share capital and adding new partners. This change does not affect the management or operation of the company.
Most sole proprietorships conducting commercial, craft, liberal, or industrial activities can be an EURL or an SASU, so long as they are not part of a regulated industry. The incorporation process is the same for both legal forms, with neither being admitted to the regulated market.
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What are the differences between an SASU and an EURL?
An SASU and an EURL differ in multiple ways, such as their articles of association, share capital minimums, and manager statuses.
Drafting the articles of association
The key distinction between an SASU and an EURL lies in the articles of association, a required document outlining a company’s operations. SASU articles of association can be written with significant flexibility, allowing the single owner great freedom in how they organize and govern the company. On the other hand, EURL articles of association must adhere strictly to the Commercial Code. Business owners can find a template for EURL articles of association online to assist in drafting them.
Minimum share capital
The minimum share capital required for registration is another difference between these two legal forms. For an SASU, 50% of the cash contribution must be deposited in the company’s bank account when the company is created. For an EURL, the amount is 20%. With both forms, the balance must be paid up within five years.
Further, for both an SASU and an EURL, the appointment of a contribution auditor is required if a contribution in kind is valued at more than €30,000 or represents more than half of the share capital.
Manager
In both an SASU and an EURL, the sole shareholder is responsible for appointing a manager and drafting the company’s articles of association. The shareholder can either assume the role of manager or delegate it to a third party. The manager is responsible for the day-to-day management of the company and represents it in dealings with third parties.
An SASU is led by a manager who can be either an individual or a legal entity. In contrast, the manager of an EURL must be an individual.
Tax status
For taxation, an SASU is automatically subject to corporate income tax (IS) but can choose income tax (IR) instead if preferred. An EURL, however, is automatically subject to IR but can choose IS instead.
Social security status
The way social security works for company managers also differs for SASUs and EURLs. A manager of an SASU is treated as an employee and is therefore covered by the general social security system. They benefit from full social security coverage.
An owner of an EURL who also acts as a manager has the status of a nonsalaried worker (travailleur non salarié, or TNS). This means that, unlike an SASU manager, they don’t receive the same social security benefits and are instead covered by the social security system for the self-employed (sécurité sociale des indépendants, or SSI). Social security coverage for a TNS provides fewer benefits but is less expensive.
If a third party (i.e., a nonshareholder) manages an EURL, they are treated as an employee and covered by the general social security system.
Setup costs
The costs to set up either business type—SASU or EURL—are almost the same, except for the legal notice publication. In 2024, the publication of an incorporation notice costs:
- €121 for an EURL
- €138 for an SASU
Transfer of shares
Finally, the registration fees differ for each legal form; SASU fees are 0.1% of the share transfer price, while EURL fees are 3% of the transfer price after a €23,000 allowance.
The transfer of shares also differs depending on the legal form. In an SASU, the sole shareholder can transfer shares to a member of their family or another third party without incurring any fees. In an EURL, the transfer of shares to a third party is regulated while the transfer of shares to a family member is not.
To transfer shares to a third party, an EURL business owner must:
- Obtain a signed or notarized share transfer deed
- Register the deed with the tax authority
- Amend the articles of association and file them online through the business formalities portal
EURL vs. SASU: A comparative table
The table below summarizes the key differences between an EURL and an SASU.
|
Feature
|
EURL
|
SASU
|
|---|---|---|
| Number of shareholders | One | One |
| Financial liability of the shareholder or entrepreneur | Limited to the amount of contributions | Limited to the amount of contributions |
| Share capital | Freely determined by the partnerAt least 20% of the contributions must be deposited when the business is created | Freely determined by the partnerAt least 50% of the contributions must be deposited when the business is created |
| Admission to the market | Not permitted | Not permitted |
| Manager | Must be an individual (either a managing shareholder or third party) | Can be an individual or a legal entity (either a managing shareholder or third party) |
| Taxation of profits | Defaults to personal income tax with the option of choosing corporate income tax | Defaults to corporate income tax with the option of choosing personal income tax |
| Manager’s social security status | Treated as a TNS if the company owner acts as the manager, treated as an employee if a nonshareholder is the manager | Treated as an employee |
| Transfer of shares | Unrestricted when transferring shares to a family member, subject to shareholder approval when transferring to a third party | Unrestricted |
| Registration fees | 3% of the transfer price after an allowance of €23,000 | 0.1% of the sale price |
EURL or SASU: Which should you choose?
An EURL provides a more secure legal framework for an individual shareholder. In addition, the minimum share capital required for registration is lower for an EURL than for an SASU. Social security contributions for a TNS manager are also lower than those for an SASU manager.
However, an SASU offers more advantages than an EURL in terms of business operations, the manager’s social security status, and the ease of transferring shares to third parties.
If you’re starting a business in which you’re the sole proprietor and you want to reduce costs while ensuring that your company’s legal structure is secure, an EURL might be the best choice. On the other hand, if you’re looking for better social protection for your company manager and greater flexibility in terms of management, an SASU might be more suitable.
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