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In this article, we explain how to make that switch and what you need to consider along the way.

What’s the difference between a sole proprietorship and a private limited company (BV/SRL)?

With a sole proprietorship (also known as a natural person business), there is no legal distinction between your private assets and those of your business. This means that, in principle, you are personally liable for your business’s debts and obligations with your entire personal assets.

A private limited company (BV/ SRL) has its own legal personality and assets. These assets are separate from the private assets of the shareholders. As a result, your personal assets are generally better protected against the risks associated with your business.

Switching from a sole proprietorship to a BV/ SRL

Have you decided that you want to switch to a BV/SRL? Then you can get started with the following step-by-step guide.

Step 1: Find an accountant and lay the foundations for your BV/ SRL

Switching from a sole proprietorship to a BV/SRL requires largely the same preparation as setting up a new one. Unlike with a sole proprietorship, a BV/SRL needs double-entry bookkeeping, annual accounts and a corporate tax return, which are all handled by an accountant.

That’s why the first step is to find an external accountant who specialises in companies and is willing to take on your file. Ideally, you involve them before you go to the notary, because they can help you with the most important decisions right from the start.

Together with your accountant, you’ll consider questions such as:

• Will you start on your own or with one or more shareholders?

• How much will you contribute when setting up the company?

• What activities will your BV/SRL carry out?

• What costs and revenue do you expect in the first few years?

• How much money do you need to get your business off the ground and keep it financially healthy?

Since 2019, there is no longer a legally required minimum capital for a BV/SRL. In the past, for example, you had to provide €18,550 in capital. Today, you determine the amount of initial capital your business needs.

That doesn’t mean you can simply start with any amount. You must provide sufficient initial assets for the company’s planned activities. A realistic financial plan is therefore essential. It should demonstrate that the company has sufficient resources to start its activities and remain financially viable for at least two years.

Step 2: Set up your BV/SRL with a notary

Once you know what you want your BV/SRL to look like, it’s time to visit the notary.

Together with you, the notary will draw up the deed of incorporation and the company’s articles of association. A notarial deed of incorporation is mandatory for a BV/SRL, so this step cannot be skipped. You’ll also hand over the financial plan your accountant prepared.

Step 3: Close your sole proprietorship and register your BV/SRL

Once your BV/SRL has been officially incorporated, you’ll also need to update your administration.

Your sole proprietorship will be closed down, and your BV/SRL will be registered as a new business. You can arrange this through an accredited business counter. The business counter will then take care of the necessary registrations and updates in the Crossroads Bank for Enterprises (CBE).

Keep in mind that the costs depend on the number of business units. In 2026, you can expect to pay around €111.50 per business unit for a registration or deregistration.

Closing your sole proprietorship also comes with a few final obligations, such as your last VAT return and your annual client listing. We explain how you can close your sole proprietorship step by step in this article.

Step 4: Review your social security contributions

Your personal registration with a social insurance fund remains in place. But once your BV/SRL is set up, there’s an additional requirement: your company must also register with a social insurance fund and pay an annual company contribution.

Your personal social security contributions, meanwhile, continue to be based on your own income.

Do you expect your income to remain roughly the same as before the switch? Then you may not need to make any changes to your personal contributions.

Do you expect your income to increase? In that case, it may be worth adjusting your provisional contributions now.

Why?

• You avoid a large adjustment payment later on.

• Higher social security contributions are tax-deductible.

• Voluntarily paying higher contributions can reduce the amount you’ll have to pay when your final income is calculated.

What else do you need to consider?

Switching from a sole proprietorship to a BV/SRL doesn’t just mean adopting a new legal structure. Your taxes, VAT administration and accounting will also change. So there are a few other things to keep in mind when making the switch.

Your personal income tax return

Are you switching from a sole proprietorship to a BV/SRL during the year? You’ll still file just one annual personal income tax return.

The profit from your sole proprietorship up until the switch is reported as professional income. Any capital gains on cessation must also be reported in part 2 of your personal income tax return. The profit your BV/SRL makes after the switch is instead subject to corporate income tax. However, any director’s remuneration you receive from your BV/SRL must still be declared in your personal income tax return.

The exact tax treatment depends on your situation, so it’s best to discuss this with your accountant.

VAT: deregistration, activation and returns for both entities

1) Deregistration

When switching to a BV/SRL, you need to deregister the VAT number of your sole proprietorship. You can do this using form 604C, either yourself via MyMinfin or with the help of your VAT office or business counter. Your VAT number will then be cancelled.

2) Activation

Your VAT number is not transferred from your sole proprietorship to your BV/SRL. Since these are two separate entities, your BV/SRL will receive its own company number and must activate a new VAT number using form 604A.

3) VAT returns

Because your sole proprietorship and BV/SRL are two separate taxable entities, you don’t file a combined VAT return. VAT administration must be handled separately for each entity.

• Final VAT return for your sole proprietorship: covers the period up to the date of cessation. Any remaining goods or fixed assets on which VAT is due must be included, unless an exemption applies.

• First VAT return for your BV/SRL: covers the period from the activation of the new VAT number.

• Customer listing: your sole proprietorship must also file its customer listing separately, within 3 months of the cessation.

What can you (and can’t you) do in Accountable as a BV/SRL?

Accountable is a great tool to manage the day-to-day side of your BV/SRL, together with your accountant. However, you can’t handle your company’s full accounting in Accountable alone, so you’ll always need an accountant.

✅ What you can do in Accountable:

• Create, customise and send your sales invoices

• Scan and encode your receipts and purchase invoices

• Follow up on your figures and cash flow in real time

• Anticipate how much VAT you’ll need to pay, and prepare your VAT returns, annual client listing and intra-EU listing

❌ What your accountant takes care of:

• Double-entry bookkeeping

• Your corporate tax return

• Your annual accounts and their filing with the National Bank (where applicable)

• Minutes of the general meeting of shareholders

Practical steps in Accountable: new account & transition period

When switching to a BV/SRL, you’ll need a new, separate account. Your existing sole proprietorship account cannot be converted into a company account because the two business structures are legally distinct.

Keep your sole proprietorship account active so you can complete your bookkeeping and correctly prepare your final VAT return, customer listing and personal income tax return. At the same time, create a new account with the “Company” business type, linked to your BV/SRL’s new company number and VAT number.

There’s no need to transfer any data between your Accountable accounts: your sole proprietorship’s bookkeeping stays in the old account, while you’ll use the new account for your BV/SRL from the moment you switch. If income and expenses from your sole proprietorship are taken over by your BV/SRL, your accountant will process this in your company’s accounts.

Timing the switch: decision date, incorporation and VAT activation

Several dates are important when switching to a BV/SRL. The date you decide to make the switch is not automatically the official start date of your BV/SRL or the date on which its VAT number becomes active. It’s therefore important to coordinate these dates carefully with your accountant and notary.

• Decision date: the moment you decide to make the switch. This is not, in itself, an official legal or tax date.

• Date of the notarial deed: the date on which your BV/SRL is legally incorporated.

• CBE registration: the administrative registration of your BV/SRL with the Crossroads Bank for Enterprises (CBE).

• VAT activation: the date on which your BV/SRL’s new VAT number becomes active.

The timing determines which income belongs to your sole proprietorship and which belongs to your BV. It also helps prevent you from starting business activities before your VAT number is active.

So make sure to coordinate the closure of your sole proprietorship, the incorporation of your BV/SRL and your VAT registration with your accountant and notary well in advance to avoid administrative and tax issues.

Still unsure whether a BV/SRL is the right choice for your situation, or do you have questions about making the switch? Feel free to send us a message via the chat or via support@accountable.eu

We’re happy to help! 😊