6 differences between physical and moral person › What is it, Physical and Moral Characteristics


6 differences between physical and moral person

Natural persons, also called natural persons, are all human beings without distinction, considered as such from conception until their death.

Moral or legal persons can be companies, non-governmental organizations, institutions, etc. They are made up of one or more people with a common goal and may or may not be for profit.

Both physical and legal persons have a series of attributes:

  1. Capacity
  2. Name
  3. Civil status
  4. Heritage
  5. Home
  6. nationality

In Mexico, individuals and legal entities must register in the Federal Taxpayers Registry (RFC) to obtain the corresponding Tax Identification Card.

This procedure is essential to be able to issue tax receipts, whether they are individuals who carry out professional activities independently, or companies or organizations for profit or not for profit.

Here we explain the 6 differences between the physical and moral person

1. Capacity

Capacity is the ability to exercise rights and comply with obligations under the law.

Natural persons have this ability without distinction. However, the capacity is limited by some factors that depend on the civil codes of each country (such as being of legal age) or by personal conditions (being intellectually or physically unable to enjoy rights or comply with obligations).

In legal entities, the capacity is determined by the purpose and the activities that they will carry out in the company or organization. It is these factors that determine what rights and obligations you must fulfill.

For example, a shoe factory is dedicated to making shoes and its activities include wholesaling and retailing. Their rights and duties are very different from those of a company that is dedicated to raising cattle, whose purpose is to feed and maintain cows.

They are companies of different nature, which carry out different economic activities, therefore, their capacities differ.

The directors and administrators of the legal entity are those who, generally, must exercise the capacity of the same.

2. Name

It is the term that is used to identify an individual or entity and is necessary to carry out legal acts (obtain an identification, sign a contract, register a company, etc.).

In natural persons, the name is generally composed of one or two proper names and two surnames: the paternal and the maternal.

For legal entities, the name must be composed of:

  • Company name : is the name chosen and freely registered by the members of the legal entity. For example, “Inversiones Firu”.
  • Social regime : it is the classification of the type of legal person. For example, if you are a public limited company (SA), limited liability company (SRL), public limited company (CA), etc.

3. Civil status

Legal persons do not have a marital status. Natural persons, yes.

Marital status is the situation of a natural person with respect to the family and the State.

Examples of marital status of a natural person are:

  • Single
  • Married
  • Divorced
  • Widower

Some marital statuses imply the enjoyment of rights or the fulfillment of obligations. For example, marriage implies the right that all children conceived within the relationship are considered legitimate and carry the surnames of the parents.

4. Heritage

They are all the assets and obligations (debts) that can be valued in money. For example, bank accounts, cash, property, cars, investments, etc.

In some legal systems, such as the Mexican civil code, it is considered that natural persons also possess a moral patrimony, consisting of:

  • The honor
  • The dignity
  • The good name or good reputation.

In moral or legal persons, the assets that make up the patrimony are disconnected from the patrimony of the natural persons that compose it. Therefore, in case of contracting a debt, loan, credit, or going bankrupt, the assets pledged for payment are exclusively those of the legal entity.

Buildings, commercial premises, cars or trucks acquired to transport the company's products, furniture, etc., are part of the assets of a legal entity.

5. Nationality

Moral or legal persons do not have nationality. Natural persons do.

Nationality is the condition that a natural person acquires in relation to a particular territory or State. This condition can be acquired in one of these ways:

  • By birth : when a natural person is born in a State that is considered its own territory.
  • By the nationality of the parents : when a natural person has parents with a certain nationality and that State recognizes him as a national, regardless of whether he was born inside or outside the territory.

For example, a person born in Mexico is Mexican. If your parents are Mexican, you also acquire Mexican nationality, regardless of whether you were born inside or outside the country.

6. Address

It is the place of residence or execution of activities.

In the case of natural persons, it is the address of the place where they live. Not all natural persons have a domicile and even so, they continue to have the rights and obligations that correspond to them by law.

For example, destitute people do not have a home address, but they still have the right to go to a hospital, to access education, to vote, etc.

In legal or moral persons, the domicile is of two types:

  • Physical address : is the address in which the activities will be carried out. If the legal entity is a cheese factory, the physical address is the place where the factory is located.
  • Tax domicile : is the address that will appear on the invoices and other corresponding tax documents.
Update date: 09 February 2021.

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6 differences between physical and moral person › What is it, Physical and Moral Characteristics
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