This page compares the main legal structures for a business in Guatemala. Picking the right one affects your taxes, your liability exposure, your ability to raise capital, and your formation cost — up to Q6,600+ for a full Sociedad Anonima. This page breaks down every entity type side by side.
Full Comparison Matrix
| Feature | Sociedad de Emprendimiento | Sociedad Anonima | SRL | Comerciante Individual | Sucursal Extranjera |
|---|---|---|---|---|---|
| Legal basis | Decreto 20-2018 | Codigo de Comercio | Codigo de Comercio | Codigo de Comercio | Codigo de Comercio Art. 213 |
| Minimum capital | Not set in Decreto 20-2018; cash only, paid within 2 years (Art. 1045) | Q200 | Q200 | Q0 | Q0 |
| Min founders | 1 | 2 | 2 | 1 | N/A (branch) |
| Max founders | Unlimited | Unlimited | 20 | 1 | N/A |
| Notary required | No | Yes | Yes | No | Yes |
| Liability protection | Yes | Yes | Yes | No (personal) | Parent company |
| Formation cost (all-in) | Registro fee not set in the decree | Q3,000-6,600 | Q2,500-4,500 | ~Q325 | Q4,000-8,000 |
| Formation time | Not set in the decree | 20-45 days | 15-30 days | 5-10 days | 30-60 days |
| Online registration | Yes (full) | Partial | Partial | Yes | No |
| Minimum directors | 1 | 3 (S.A.) or 1 (admin) | 1 (gerente) | N/A | 1 (representative) |
| Audit required | No (under threshold) | Yes (over Q5M revenue) | Yes (over Q5M revenue) | No | Yes (typically) |
| Issue shares | Limited | Yes (full) | No | No | N/A |
| Suitable for VC investment | Convert first | Yes | Possible, unusual | No | No |
| Foreign owners allowed | Yes | Yes | Yes | Yes (with residence) | Yes |
| Annual compliance cost | Low | High | Medium | Low | Medium |
| Preferential tax regime | No (Decreto 20-2018 creates none; its Art. 35 deduction is for investors) | No | No | Yes (pequeno contribuyente) | No |
Sociedad de Emprendimiento (S.E.) — The Bootstrap Choice
Created by Decreto 20-2018 (Ley de Fortalecimiento al Emprendimiento). Designed specifically for startups and small businesses. The single biggest advantage is that formation requires no public deed (Commercial Code Art. 1042): it is done online at the Registro Mercantil, with every shareholder signing electronically (Art. 1043).
Best for: bootstrap founders, e-commerce, software startups, consultants, small retail, small food service.
Key features:
- Online registration through Registro Mercantil portal
- Simplified standard template for constitutive act (no escritura publica)
- Not subject to the 5% legal reserve (Commercial Code Art. 36 as amended); cash contributions only; shares paid within two years of registration (Art. 1045)
- Must transform into another corporate form within six months if annual income exceeds Q5,000,000 (Art. 1040); the decree sets no five-year limit
- Name must be followed by “Sociedad de Emprendimiento” or “S.E.” (Art. 1041)
- Annual income cap of Q5,000,000, updated each January 1 (Art. 1040)
Deep dive: Sociedad de Emprendimiento Setup Guide
Sociedad Anonima (S.A.) — The VC-Ready Choice
The traditional Guatemalan corporation. Required by most institutional investors. Highest formation cost but also the most flexible governance and the only structure that can freely issue transferable shares.
Best for: VC-backed startups, businesses with multiple investors, family businesses with long horizons, companies requiring complex share classes, regulated industries (financial, insurance, telecom).
Key features:
- Minimum paid-in capital Q200 (Art. 90 Código de Comercio, reformed by Decreto 18-2017); at least 25% of the subscribed nominal value paid in at formation (Art. 89). Many S.A.s declare more (Q5,000+) for bank/credibility reasons, but the law only requires Q200.
- Minimum 2 founders, minimum 3 directors (consejo de administracion) unless single-administrator structure is used
- Formation by escritura publica (notarized deed) — notary fees Q2,000-5,000
- Must publish incorporation in Diario de Centro America (Q300-500)
- Annual shareholder meeting required, minutes filed with Registro Mercantil
- Audit required if revenue exceeds Q5 million annually
- Shares are nominative and freely transferable (subject to escritura restrictions)
Sociedad de Responsabilidad Limitada (SRL) — The Professional Practice Choice
A middle ground between individual trading and a full S.A. Common for professional partnerships (law firms, accounting practices, medical groups, design studios). Simpler governance than S.A. but still requires notarized formation.
Best for: 2-20 partners in a professional practice, small manufacturing, mid-size services firms.
Key features:
- Minimum Q200 capital (token amount, fully paid at formation)
- Minimum 2 partners, maximum 20 partners
- Formation by escritura publica (notary required) — fees Q1,500-3,000
- Administered by one or more gerentes (managers), not a board
- Partner exits require amending the escritura (not a simple share transfer)
- Audit required if revenue exceeds Q5 million annually
- Cannot issue shares in the public market
Comerciante Individual — The Freelancer Choice
Not a separate legal entity — you as an individual register as a trader. Simplest structure, lowest cost, but you have unlimited personal liability for business debts and legal claims.
Best for: freelancers, solo consultants, independent contractors, one-person service businesses with low liability exposure.
Key features:
- No entity, no shareholders, no directors — just you
- Register via Registro Mercantil — Q100 to register as a comerciante plus Q100 to register the empresa (Q200 total, per the RM arancel) — then SAT (NIT + RTU + FEL, all free)
- Your personal DPI is effectively your business identity
- Can hire employees (requires IGSS patronal registration)
- Can combine with the pequeño contribuyente regime for simplified filings under Q500,285/year (the 2026 ceiling)
- Key risk: personal assets (house, car, savings) are exposed to business creditors and lawsuits
E.I.R.L. — not available in Guatemala
Guatemala has no Empresa Individual de Responsabilidad Limitada. Code of Commerce Art. 10 lists the company types exclusively: sociedad colectiva, comandita simple, S.R.L., S.A., comandita por acciones and, since Decree 20-2018, the sociedad de emprendimiento. For a single founder who wants limited liability, the legal vehicle is the sociedad de emprendimiento (one or more natural persons, Decree 20-2018). Correction (24 Sep 2026): earlier versions of this page listed the E.I.R.L. as a Guatemalan entity type with Q5,000 capital; it is not one. See EIRL in Guatemala.
Sucursal de Sociedad Extranjera — Foreign Branch
A branch office of a foreign parent company. The branch is not a separate entity — it is legally part of the foreign parent, which retains all rights and obligations. Used when the parent wants a local presence without creating a Guatemalan subsidiary.
Best for: foreign corporations expanding to Guatemala temporarily, testing the market, or avoiding the overhead of a full subsidiary.
Key features:
- No separate shareholders in Guatemala — parent owns 100%
- Must designate a Guatemalan-resident legal representative
- Requires apostilled corporate documents from the home country, translated by traductor jurado
- Parent company’s liability flows through to the branch
- Taxed on Guatemala-sourced income only
Conversion Between Entity Types
Guatemala law allows most conversions without requiring dissolution and refoundation:
- Sociedad de Emprendimiento → S.A. or another form — required within six months once annual income exceeds Q5,000,000 (Commercial Code Art. 1040), or to list shares on an exchange (Art. 1054)
- Sociedad de Emprendimiento → SRL — allowed, uncommon
- Comerciante Individual → S.A. or SRL — possible but effectively a new entity; your personal NIT stays, but you create a new business NIT
- SRL → S.A. — allowed, requires amending escritura and shareholder resolution
- S.A. → SRL — allowed
Conversions require a notarized deed and Registro Mercantil filing.
Tax Treatment by Entity
Important note: the entity type affects the legal structure, not the tax regime. Tax is determined separately when you register with SAT:
| Tax regime | Who can elect it | Rate |
|---|---|---|
| Pequeño Contribuyente | Individuals and entities under Q500,285 annual gross revenue (2026) | 5% on gross income, in place of IVA; exempt from ISR and ISO |
| Régimen Opcional Simplificado Sobre Ingresos | Any entity | 5% on monthly gross income up to Q30,000; Q1,500 + 7% on the excess above Q30,000 |
| Régimen Sobre las Utilidades de Actividades Lucrativas | Any entity | 25% on net taxable income |
Decreto 20-2018 does not give the Sociedad de Emprendimiento a tax regime of its own.
Legal basis: the 25% rate is Art. 36 of the Ley de Actualización Tributaria (Decreto 10-2012) and the 5%/7% brackets are Art. 44 of the same law. The pequeño contribuyente ceiling is set by Decreto 31-2024 at 125 non-agricultural monthly minimum wages per year — Q500,285 for 2026 per SAT. Because that ceiling is indexed to the minimum wage, it rises every year (it was Q465,381.25 in 2025).
Which Structure Should You Pick?
- Bootstrap founder, services or software, not raising VC → Sociedad de Emprendimiento
- E-commerce or online store, bootstrap → Sociedad de Emprendimiento
- Freelancer or consultant, low liability risk → Comerciante Individual
- Raising VC in next 12 months → Sociedad Anonima
- Law firm, accounting practice, medical group → SRL
- Family business, multi-generation horizon → Sociedad Anonima
- Restaurant or retail → Sociedad de Emprendimiento while annual income stays under Q5,000,000 (Art. 1040)
- Foreign corporation expanding to Guatemala → Sucursal (branch) OR local subsidiary S.A.
- Financial services, insurance, regulated utility → Sociedad Anonima (required)
Related Guides
- Business Formation Hub — The main pillar page
- Sociedad de Emprendimiento Setup — Full walkthrough
- Foreigner’s Guide to Forming a Business — Apostille chain, bank accounts, legal rep
- NIT Setup — First step after formation
- FEL Habilitacion — Mandatory electronic invoicing
- Pequeño Contribuyente Regime — Simplified tax regime
Tax rates, tax thresholds and Registro Mercantil fees re-verified September 2026 against Decreto 10-2012 (Arts. 36 and 44), SAT’s published Decreto 31-2024 guidance, and the Registro Mercantil arancel. Remaining details verified April 2026.
