KIND OF LEGAL BUSINESS IN SPAIN
If you wish to set up a business in Spain, the first step is to decide which kind of legal structure you wish to implement. The most commonly used options are as follows:
1. Self-employed workers in Spain (commonly known as “autonomos”).
An ideal option if you have no business partners, and overall cheaper and easier than setting up a limited company. You will need to register your business with the Tax revenue office and the Social Security office.
You’ll have to submit quarterly VAT (IVA) returns, as well as an annual income tax return an (I.R.P.F.). Find out more about the requirements by contacting us.
2. Limited companies in Spain (in Spanish Sociedad limitada or S.L.)
Incorporation is important in protecting the owner from personal liability in the event of bankruptcy.
However, you will need a regulated” gestor&accountant” to guide you appropriately through the maze of applicable tax legislation, accounting, and mercantile obligations.
Limited companies pay corporation tax, which is levied on worldwide profit.
Tax breaks are available for new companies. Please contact us for further details about the applicable percentages.
Remember, failing to comply with your tax obligations might involve the imposition of expensive fines and sanctions from the tax revenue office. We are currently representing in Court several companies that have serious problems with the Tax office.
HOW TO SET UP A LIMITED COMPANY IN SPAIN
If you wish to incorporate a limited company in Spain, please see below the steps required:
- Apply for a foreigner’s tax identification number (NIE)
- Register the company name at the Mercantile Registry (in Spanish “Registro Mercantil Central or RMC”)
- Obtain a company tax identification number (CIF)
- Fill out the Tax form 036
- Open a business bank account, with a Spanish bank and make a deposit of €3.000. (Minimum share capital allowed when setting up a limited company.
- Sign the deed of incorporation at the Notary. (This is the official document that states the key information of the company (name, address, shareholders, etc.).
- Register the company the deed of incorporation at the Local Government Tax office, and at the RMC
- Register for social security
FOREIGN COMPANIES OPENING UP A BRANCH IN SPAIN
If you are looking to set up a branch or subsidiary in Spain, you’ll need to provide the following paperwork:
- A copy of the main company’s certificate of incorporation and certificate of good standing
- Notarized power of attorney
- Spanish tax identification number (NIE)
- A member of staff at the Spanish branch to be a resident in Spain, who will agree to be liable for any company debts and tax payments
Regarding taxation, while additional subsidiaries might not need to file accounts on the business register, the will have to pay anyway income tax and submit quarterly VAT returns as well.
BUSINESS INSURANCES IN SPAIN
As an owner of a limited company, you will need to take out a civil liability insurance policy to protect your employees in the event of accidents or sickness. This is crucial if you are running a business, as a comprehensive insurance will cover you against any claims by third parties regarding injuries, accidents, or damage of property caused by third parties, etc
Likewise, you will also need buildings and contents insurance. This will protect you against any damage to your offices or loss of stock; as well as covering theft of stock owned by your company.
To find out more about Spanish insurance options, please contact us directly for a free quotation.
BUYING OR RENTING PREMISES FOR YOUR BUSINESS IN SPAIN
Whether you wish to buy or rent a factory, office or local for business, it is of the utmost importance that a regulated and expert Solicitor like our Firm prepares for you the appropriate contract. Bear in mind that for a little fee, you will be able to save thousands of euros in protracted litigation at the event of a dispute.
To find out more about Spanish property or tenancy rules and rights, check out the other sections of our website www.bestsolicitorsinspain.com
How to contact us for further specific advice?
We hope this information is useful. Remember that this is not intended to be specific legal advice, just a general overview. Should you be interested in receiving more specific information, (either about this particular subject or any other), you can contact our firm several ways:
1. Call us or send us a WhatsApp now to (0034) 687 88 88 73.
2. You can also use our e-mail form at the top of the sidebar of your screen, or alternatively, you can send us e-mail to firstname.lastname@example.org
Our commitment, we’ll respond to your e-mail inquiry in less than 24 hours.
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Finally, thank you very much for your attention, and in case you might have any question or doubt at all, again please do not hesitate to contact us. We will be glad to help you in order to advise you appropriately about the most convenient legal option for your business.
We look forward to helping you and the benefit of our “know-how”.
Mr Oscar Ricor
“NON-PRACTISING ENGLISH SOLICITOR IN ENGLAND AND WALES”, under the “Solicitors Regulation Authority” (SRA) SRA number 519196 and practising Spanish Solicitor.