How to Set Up a Company in Spain

English · Español · 简体中文

Spain is a natural gateway to the European Union and to Latin America, with strong infrastructure and a large internal market. Most activities are open to foreign investors, although non-EU investors in strategic sectors may need prior authorisation.

1. Choose the vehicle

• Sociedad Limitada (SL): the most common choice. It can have a single shareholder and the legal minimum capital is now very low, although some protective rules apply until the company reaches a higher capital.
• Sociedad Anónima (SA): for larger projects, with a minimum capital of EUR 60,000.
• Branch of a foreign company, registered in the Commercial Registry.

2. Main steps

1. Tax identification for foreign shareholders and directors: an NIE for individuals and an NIF for foreign companies.
2. Name certificate from the Central Commercial Registry.
3. Bank account and capital contribution, or a contribution in kind.
4. Deed of incorporation before a Spanish notary, including the bylaws and the declaration of beneficial owners. Foreign documents must be apostilled and translated.
5. Company tax ID (NIF) and registration in the provincial Commercial Registry.
6. Tax and social security registrations before starting activity and hiring.

3. Points to watch

• FDI screening: investors from outside the EU and EFTA acquiring significant stakes in strategic sectors (such as critical infrastructure, technology, energy or media) may need government authorisation before closing.
• Foreign investment declaration: most foreign investments must be declared to the Investment Registry after they are made, for statistical purposes.
• Residence and work: foreign directors who move to Spain need the right visa or permit; Spain has specific routes for entrepreneurs and highly qualified staff.
• Tax: the general corporate income tax rate is 25%, with reduced rates for new companies and small businesses; VAT is generally 21%. Spain has a wide treaty network, including with China.

4. After incorporation

The company must keep accounts, file quarterly VAT and withholding returns and an annual corporate tax return, file annual accounts with the Commercial Registry, legalise its corporate books and keep its beneficial ownership information up to date.

The views expressed are personal and do not necessarily represent the position of NET CRAMAN. This article is for general information only and does not constitute legal or tax advice. Rules change over time; seek specific advice before acting.