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From what income should you incorporate a company?

My income is growing — should I incorporate a company?

Written by Lionel ROSU

As a general rule, incorporating a company becomes worthwhile when:

  • your annual profit as a self-employed person exceeds €50,000

  • you don't need your entire income to cover your living expenses

  • you want to optimise your compensation

However, there is no universal threshold: everything depends on your family situation, your income, and your plans.

For incorporation to be worthwhile, what matters is that taxable profit remains in the company after your compensation (Revenue − Professional expenses − Compensation = Taxable profit), that amount being taxed at the corporate income tax rate (CIT), which is lower than the personal income tax rate (PIT). If you withdraw everything as compensation, no profit remains in the company, and incorporation brings no tax advantage.

To explore your situation further, two options:

  • 👉 Our complete guide, which details the criteria and provides concrete examples

  • 🧮 Our comparison tool, which simulates what you actually take home as a self-employed person or as a company director, based on the income and expenses you define.

Questions about your situation? Contact us via the chat 😊

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