{"id":62897,"date":"2025-08-04T12:40:53","date_gmt":"2025-08-04T12:40:53","guid":{"rendered":"https:\/\/emprendix.com\/?p=62897"},"modified":"2025-08-04T12:40:53","modified_gmt":"2025-08-04T12:40:53","slug":"what-are-the-disadvantages-of-a-limited-liability-company","status":"publish","type":"post","link":"https:\/\/emprendix.com\/en\/what-are-the-disadvantages-of-a-limited-liability-company\/","title":{"rendered":"What are the disadvantages of a Limited Liability Company?"},"content":{"rendered":"

Setting up a Limited Liability Company (SL) can be an excellent option for many entrepreneurs, as it offers advantages such as personal asset protection. However, it\u2019s not all benefits. This business model also presents a series of disadvantages that should be carefully evaluated before incorporation<\/strong>.<\/p>\n

From our administrative consultancy in Palma de Mallorca<\/strong><\/a>, we explain the main drawbacks you should consider if you are thinking of creating an SL in Palma de Mallorca<\/strong><\/a>.<\/p>\n

1. Greater administrative complexity<\/h2>\n

Unlike registering as a sole trader, the creation and management of an SL involves more procedures and legal obligations<\/strong>. You must maintain formal accounting, hold shareholders\u2019 meetings, file annual accounts, and comply with commercial and tax regulations. This requires more rigorous management and often professional support.<\/p>\n

2. Higher initial and maintenance costs<\/h2>\n

Forming an SL includes several initial expenses<\/strong> such as:<\/p>\n