If you owe money to the tax office or to the Social Insurance Agency, the law does not allow you to acquire a share in an s.r.o. or to set up an s.r.o. The question is how you can lawfully acquire a business share in an s.r.o., or establish one, while you have outstanding tax or social security debts.

You can read the full solution on our blog: https://etuls.blog.pravda.sk/2019/11/08/dlh-na-daniach-a-nadobudnutie-s-r-o/

Dealing With Tax and Insurance Debts Before Doing Business

Debts owed to the tax office or to social or health insurance institutions can have consequences that go beyond the debt itself. In Slovakia, outstanding obligations of this kind can affect your ability to become a shareholder in or found a limited liability company. Anyone planning to start or acquire a business while having such debts should therefore address the situation early and lawfully.

Know Your Position

The first step is to find out exactly what you owe and to whom. Statements from the tax office and insurance institutions show the amount outstanding, including any interest or penalties. Sometimes a debt turns out to be smaller than expected, or may even result from an administrative error that can be corrected.

Possible Solutions

The appropriate solution depends on your circumstances. Options may include:

  • Paying the debt in full before starting the process
  • Agreeing on a payment arrangement with the relevant institution, where available
  • Checking whether any part of the debt is disputed or time-barred
  • Considering whether another legal structure is more suitable for your plans

Any solution should be fully transparent and comply with the law. Attempting to hide debts or use arrangements designed to circumvent legal requirements can lead to serious consequences.

Why It Matters for Your Business

Even when it is possible to proceed, unresolved debts can affect your credibility with banks, business partners and public authorities. They may also lead to enforcement proceedings that could affect your assets. Dealing with them before starting a new venture gives your business a cleaner start.

Prevention

To avoid problems in the future, keep track of your tax and insurance obligations, file returns on time and set aside funds for payments. A good accountant can help you stay on top of deadlines.

Seek Advice Early

The rules in this area are specific, so it is wise to seek advice before you sign any documents or make commitments.

If you have debts with the tax office or insurance institutions and want to set up or acquire a Slovak s.r.o., contact eTuls. We will review your situation and explain the lawful options available to you.