Business in Spain

If you are thinking of starting a business in Spain, or are already running one, find all the information you need on setting up and doing business here.

Are you an expat in Spain looking to start your own business and make a mark in the vibrant Spanish market? Spain offers a plethora of opportunities for aspiring entrepreneurs, and with the right ideas and strategies, you can find success in this exciting environment. In this article, we will explore 25 business ideas to start in Spain as an expat that will allow you to tap into the local market and fulfill your entrepreneurial dreams.

Spain: The ideal destination

Spain is an attractive destination for expats looking to start their own small business ventures. Since it has a vibrant tourist culture, many retail-based businesses have sprouted up around popular areas to meet the needs of vacationers and locals alike. From food-related businesses to clothing boutiques or souvenir shops, there is plenty of opportunity to break into local scenes while enjoying a fulfilling expat experience in Spain.

business ideas to start in Spain as an expat

1. Designer Clothing

If you are creative, designing clothes is an excellent business opportunity in Spain. There is a high demand for fashionable clothing, so if you have an eye for style, take advantage of it. You can open your boutique or sell online to capitalize on the Spanish market and beyond. Customers will pay top dollar for unique pieces, so it’s a great way to make your mark on the fashion scene.

2. Create online courses

Creating online courses is probably the greatest passive income source for an Expat in Spain. This allows you to share your expertise, knowledge, and skills with the world through digital technology and generate passive income. You can either do it through your own website using a subscription or go to Udemy and create an online course. There are thousands of subjects you could begin teaching on, and you have unlimited opportunities to go deeper than necessary to learn the right topic.

3. Tour Guide Business

The Spanish coast, like Costa del Sol, is a popular tourist destination and provides an opportunity to open a tour guide business. You can offer guided hikes, city tours, or historical excursions to make the Spanish experience even more enjoyable for visitors. You can also offer transport services and give tourists a more comfortable experience as they explore the country.

4. Build a content website

If you’re looking for an affordable business idea and the possibility to work from home, look no further than a content website in Spain! To start off, pick a niche that is not too saturated with blog posts from other websites. Then get creative on topics that will provide value and apply some SEO techniques. With enough effort, your website will capture more traffic daily, meaning it’s time to monetize. Consider leveraging Google Adsense or offering ad space directly to partnering companies who can benefit from your site’s affiliation.

5. Laundry Service Business

This is one of the simplest business ideas to start in Spain as an expat and can be very profitable. You only need a few washing machines, a dryer and some Spanish-speaking staff to get started. Once your business is running, you can offer additional services like ironing or even door-to-door service. The idea is to provide convenience for your customers, making them more likely to stay loyal.

6. Become a language teacher

Although English is still the number one language that Spaniards try to learn, nowadays, many individuals wish to learn additional languages. In that case, if you’re an expert in German, Chinese, Japanese, Araba, Hindi, French or Italian (or any other language), then there will be no shortage of eager students looking to learn from you.

7. Handyman Business

Every Spaniard needs a handyman at some point, and this is a great business to get into in Spain if you are handy with DIY projects. You can offer plumbing, painting, carpentry, and electrical work. The Spanish market is always looking for reliable, quality handymen.

8. Coffee Shop or Cafe

In Spain, coffee shops are more than just places to grab a quick cup of joe, and they are places where people gather to relax, read, and chat with friends. Opening your own coffee shop or cafe is a great way to bring Spanish culture home.

9. Souvenir shop

Without a doubt, thousands of tourists flock to Spain throughout the year. There’s something for everyone: Barcelona and Madrid, hikes or gastronomical tours. Yet one activity remains constant amongst them all – souvenir shopping. If you plan strategically and select an appropriate location that is central but also cost-effective on rental prices, then your demand as a shopkeeper will be high. Finding this balance between accessibility and economic costs can successfully promote your business venture to the Spanish population and tourists alike.

10. Food Truck

This is an excellent business opportunity for expats who are passionate about cooking. Setting up a food truck allows you to bring your traditional meals to different locations. You can easily customize the menu to reflect Spanish flavors and regional specialties.

11. Open a travel agency

Everyone loves traveling, and Spain is a great destination for both Spanish nationals and foreigners alike. If you’re passionate about helping people plan the perfect Spanish getaway, then opening a travel agency could be your ticket to success in Spain. If a business idea is going to be worthwhile, it should involve selling experiences instead of products or services. As an expat in Spain, you are uniquely positioned to take advantage of this and offer tourist packages that cater specifically to the needs and desires of visitors from around the world. You know exactly what impressed you when exploring Spain; now, share those same memorable experiences with others. You can arrange everything from flights, accommodation, and car hire to guided tours and local activities.

12. Ice Cream Shop

Because of the hot weather, ice cream is a favorite Spanish treat, so starting an ice cream shop in Spain can be very profitable. It is a relatively inexpensive business to start, and the overhead costs are low. If you choose to make your ice cream from scratch, you can customize flavors that use Spanish ingredients like olive oil, almond milk or churros crumbles. You could even offer vegan options for those with dietary restrictions. With some creativity and hard work, you can create an ice cream store that is popular with locals and tourists.

13. Spa service

Spas offer services to improve health and beauty through personal care treatments. Spa services range from manicures to pedicures and massages to facials. You can set up a spa business in Spain by providing services catering to locals and tourists. With the right marketing strategy, you can make your spa business stand out from the competition.

14. Translator

Spain is renowned for its tourism and entices travelers from all corners of the globe each year. Since visitors tend to prefer communicating in their native language, this creates an exciting opportunity for translators. You can serve as a translator during any travel-related activity or explore other fascinating options that are available to you.

Choosing the path of a freelance translator will unlock countless opportunities for you. Whether it’s website content or promotional material, your skills can be used to create multilingual versions and convey messages worldwide. As Spain has numerous languages, you can specialize in Spanish translations, Spanish-English translations or even Spanish-French and Spanish-German translations. If you’re a polyglot with experience in more than one language, then this could be the perfect business opportunity for you to explore.

15. Organic Meals Café/Resto

Eating healthy is no longer a trend – it’s an international craze, particularly in Spain. If you have the ambition and vision to make a difference in the health market, why not open a restaurant or cafeteria specializing in healthy cuisine? You’re sure to carve out your own niche while providing people with nutritious food options that they can enjoy. Organic ingredients are now widely available, however, it’s essential to make sure you understand Spanish food laws and regulations, as well as the Spaniard’s taste in food.

business ideas to start in Spain as an expat

16. Digital Marketing Agency

This is one of the most thriving businesses globally; Spain is no exception. With the Spanish economy growing, Spaniards are turning to digital marketing to help them reach their desired audiences. If you have a background in social media and digital marketing, then this could be the perfect business opportunity for you. You can offer services such as web design, search engine optimization, content creation, social media management and blogging to Spanish companies – helping them improve their online visibility and brand recognition. The Spanish market is still relatively young, so there’s a great opportunity for you to carve out your own space in the digital marketing industry.

17. Start a destination wedding service

Spain has some beautiful destinations in which couples could marry. You can help couples decide on their weddings during their vacation in Spain, or even organize the wedding itself. For this type of business, you need to be proficient in Spanish, have knowledge of local rules and regulations, and know how to contact local professionals such as florists and photographers. You also need to get all the documents required, such as officiating the event.

18. Tour guide

Do you know all the hidden gems of Spain? As an Expat, why not use your knowledge to help tourists explore the country further? You can start your own tour guide business and take people of various nationalities to the most beautiful spots in Spain. You can provide tours on foot, bike or motorbike – whatever suits your clients best. With the proper business set-up, you can help tourists experience Spain like a local and make money at the same time.

19. Start a hotel business

Each state which has destination tourism needs a hotel. If you have the necessary resources and experience, this could be your chance to become a hotelier in Spain. Adding breakfast in an offer can help you attract more patronage because most people prefer hotel meals, especially in the morning.

20. Become a personal fitness trainer

Another great business idea to start in Spain as an Expat is to become a personal fitness trainer. With more and more people becoming conscious about their health, there’s an ever-increasing demand for personal trainers. You can offer services such as gym sessions, personal training sessions, nutrition counseling and so on to help people stay fit and healthy.

21. Start a car rental service

If you’re looking for a profitable business idea to start in Spain as an Expat, then consider starting a car rental service. With more and more people traveling to Spain, there’s great potential for business in this sector. You can offer luxury cars or budget-friendly vehicles for rental to tourists. You will need a valid business license and a fleet of cars (or a partnership with an existing car rental company) to make this business a success.

22. Start a trading company

Another great business idea to start in Spain as an Expat is to set up a trading company. You can either import goods from overseas or export them to other countries, depending on the demand in Spain. This is a lucrative business opportunity and will require some initial investment. You need to be aware of the current rules and regulations for setting up a trading company in Spain and must be familiar with the local market.

23. Become a freelance social media manager

Social media is now an essential part of any business’s marketing strategy, and many businesses are now looking to outsource their social media management tasks. As an Expat, you can use your skills and knowledge to become a freelance social media manager for Spanish companies. You will need to be well-versed in using various social media platforms and have some marketing experience to make this business work.

24. Become an AI consultant

Artificial Intelligence (AI) is transforming the way businesses operate today, and there’s a huge potential for AI consultants in Spain. As an AI consultant, you will have to help businesses understand and implement AI solutions to improve their business processes. You will need a good understanding of the latest AI technology trends and familiarity with the Spanish market. This is a great online business to start and make money in Spain as an Expat.

25. Cleaning Business

The best business ideas to start in Spain as an Expat include a cleaning business. Cleaning services are always in demand, especially with the busy lifestyles many of us lead. You can offer various services such as cleaning windows, carpets, upholstery, cars, and more. You may also want to consider offering laundry services or housekeeping services as well. This is an affordable business to start, and you don’t need much capital or experience to get started.

A word from SpainDesk

Starting a business in Spain as an expat can be an exciting and rewarding endeavor. With a diverse range of business ideas to explore, from tapping into the tourism industry to opening a restaurant, starting a language school, launching a freelancing career, or establishing an e-commerce business, there are ample opportunities to succeed. By combining your unique skills, passion, and a deep understanding of the local market, you can pave the way for a thriving business venture in Spain. So, take the plunge, unleash your entrepreneurial spirit, and embark on a remarkable journey in the land of opportunity.

Disclaimer: Information on this page may be incomplete or outdated. Under no circumstances should the information listed be considered professional legal or financial advice. We highly recommend seeking guidance from a legal or financial expert if you lack extensive knowledge or experience dealing with any of the procedures outlined in these articles.

When starting a business in Spain, you will have to choose the types of company entities you want to establish. There are five general types of legal structures in Spain, and each one has its own set of benefits and drawbacks. In this article, we will give an overview of each type of Spanish legal structure that can help you make an informed decision when starting your business.

Business entities in Spain

The following business entities exist in Spain:

  1. Autonomo or Empresario Individual – Sole Trader/Sole Proprietor
  2. Sociedad Limitada (SL) – Private Limited Liability Company
  3. Sociedad Anonima (SA) – Public Limited Liability Company
  4. Sociedad Limitada Nueva Empresa (SLNE) – New Private Limited Liability Company
  5. Sociedad Cooperativa (S. Coop.)

Sole Trader/Sole Proprietor – Empresario Individual or Autónomo

The Autonomo or sole trader is the simplest entity. The Autonomo is an individual person, (single owner). For tax purposes, the Autonomo is ideal for freelancers with limited startup capital and income below 50.000 euros.

However, the sole proprietor is responsible for all business activities and for all of the company’s liabilities. Registration is simpler than the other business entities. In general, no VAT registration is needed to start trading as an Autonomo.

Many people start with the Autonomo entity but later switch to a more professional business structure, due to the liability.

Business entities in Spain

Sociedad Limitada (SL) – Private Limited Liability Company

In Spain, the most common limited company is the SL company. SL stands for Sociedad Limitada. It is similar to the US limited liability company (LLC) and the German GmbH, but it has some additional requirements to its structure.

A VAT number is required for the SL. The company must be registered with the Commercial Registry.

Only one person is required to be appointed as a director of the company, there is also an administrator needed. Other characteristics are:

  • The number of shareholders the SL can have ranges from 1 to 50.
  • The minimum share capital is 3,000 Euros.
  • The fiscal domicile of an SL Company is in Spain.
  • The 25% Spanish corporate income tax applies to an SL Company.
  • Shares can be freely transferred.

Disputes between the shareholders can be managed by setting up proper articles of association. A general meeting of the members is required to be held at least once a year. The annual accounts have to be submitted to the trade company registry.

Sociedad Anonima (SA) – Public Limited Liability Company

Just like the S.L company the SA company has limited liability for the shareholders. The S.L however is made for larger corporations (with larger investments), whereas the Sociedad Anonima is meant for smaller companies.

The minimum share capital is 60.000 Euros. 25% of the minimum capital needs to be contributed to the business at the beginning. There should be at least one director and an administrative body present for this type of company.

The public limited company or SA is the business entity most commonly used for public trading. This type of company has an open structure, which means reports need to be made public. This sort of structure is typically constructed to entice investors to do large projects.

Sociedad Limitada Nueva Empresa (SLNE) – New Enterprise Limited Company

The maximum number of partners is restricted to five, and they must be natural persons rather than legal entities. Similar to the other limited entities, there should be a General Meeting of partners and an administrative body.

The Sociedad Limitada Nueva Empresa is simpler than the SL. A drawback of this type of company is that the corporate name will consist of the full name of one of the partners, following the SLNE.

The advantages of this type of company are that it is easier to manage and it is easier to create.

Sociedad Cooperativa

A partnership comprises two or more people and no money is necessary. In general, the members of the partnership are responsible for any financial obligations and the company’s debts. Partners divide the company’s expenses equally among them according to their investment.

In general, civil society is a pact between the participants in which they combine their money, property, and other assets to achieve a shared objective.

To start a partnership, both parties need to make a civil pact before the notary. They will also need to register their economic activity and form a new entity before a notary. In addition, the name of the firm must contain the words “Cooperative Society” or its abbreviation “S. Coop.”

Both parties will carry equal losses and profits, in other words, there is a liability for both parties.

With the collaboration, each party is taxed as an individual and as a self-employed person, not the company. This means that you will be taxed through your personal income tax.

There are many types of partnerships possible, and you can find more information on the IPYME website about these types of legal entities.

Starting a business in Spain

A word from SpainDesk

You can choose from a few different types of company entities in Spain. We’ve outlined the most common ones above. If you need assistance determining which one is best for you or want to outsource the formation of your company to us, our corporate attorneys can assist.

In addition to company formation services, we can also offer accounting services to help you keep track of your company’s finances. Our team can help you stay on top of your business’s financial health, so you can focus on growth.

Disclaimer: Information on this page may be incomplete or outdated. Under no circumstances should the information listed be considered professional legal or financial advice. We highly recommend seeking guidance from a legal or financial expert if you lack extensive knowledge or experience dealing with any of the procedures outlined in these articles.

Are you interested in learning more about the various layers of employment law in Spain? When you are starting a business, buying a business, or want to put someone on the payroll, it is good to learn more about the employment laws in Spain.

Spanish workers have solid protective measures that provide their workplace safety and well-being. Contractual obligations, maximum work hours, social security, minimum pay, paid holidays, and wage payouts are parts of Spain’s employment law. This is why our employment lawyers in Spain are ready to assist you. This article will discuss the basics of Spanish employment law and associated topics.

Definition of a contract of employment

The three components of an employment contract are as follows. In the first place, there is an assurance on the part of the employee to undertake specific tasks. The key element here is that the individual will be personally obligated to the employer (i.e., he must carry out the activities himself and may not delegate them to another without his permission).

Secondly, there is an obligation on the employer’s part to pay the employee’s salary. This can be in the form of a fixed salary or may reflect the number of hours worked. The compensation can also include a bonus, benefits, a payment in another way, or a combination of the three.

Thirdly, a relationship of subordination by which the employer is entitled to give the employee instructions which the latter must follow. If the employee fails to follow these, he will breach the contract and be liable for such penalties as dismissal.

If all three components exist, the parties will be deemed to have an employment contract.
Employment Law Spain

Get fast and professional solutions for your labor challenges in Spain

Employment contract forms

In general, Spanish employment legislation permits contractors significant leeway in employment contract creation. Oral or written employment contracts are allowed. During the term of a verbal agreement, either party may demand that it be written down.

There are some exceptions to this including. For example, when you put a temporary or part-time contract in place, it needs to be in writing.

Temporary employment contracts

Contracts of employment may be entered into for a temporary or indefinite period. An employment contract for a temporary period in principle terminates by operation of law upon the expiry of that period. The duration of a contract of employment for a temporary period is thus fixed in advance. The duration of a contract for an indefinite period, on the other hand, is not.

Part-time contracts

Part-time contracts are contracts of employment with a working schedule of less than the normal full working week established by law or collective bargaining agreement. They may be written or oral. The duration is typically short-term (less than six months).

The minimum length for part-time contracts is two weeks, but this is flexible in the case of seasonal work. Part-time contracts do not preclude full-time contracts.

Fixed-term employment contracts

Fixed-term employment contracts are similar to temporary employment contracts in that they terminate by operation of law at the end of the fixed period. Where, however, there is no express provision for termination on the expiry of the contract, it is deemed to be indefinite.

Fixed-term contracts may only be entered into for a specific purpose, and additional rules apply when the contract is for work of a temporary nature.

The main difference between short-term contracts and fixed-term contracts is that an employer must have a justifiable cause to enter into a contract for a predetermined period. Instead, this is not necessary for shorter employment agreements intended for a specific job or project.

Worker Rights in Spain

Worker Rights in Spain

Worker rights in Spain are extensive. They are established by law and fall into two categories, statutory rights, which are guaranteed by statute, and rights arising from the collective bargaining agreements, which apply to different sectors of activity. Spain is a member of the International Labor Organization (ILO) and ratified the main ILO Conventions on workers’ freedom of association and right to organize and right to bargain collectively. These Conventions and the Law guarantee workers’ rights in Spain.

Work hours under Spain employment legislation

Many people have certain thoughts about the working hours in Spain. Some people think that Spanish people work hard until late, while others think they work less and rest more. The truth is that Spanish working hours are becoming more similar to Western Europe’s working hours.

According to a poll, around 60% of Spaniards never take a siesta, while just 18% admit to resting for a time in the middle of the day. When the company has implemented a siesta time (which is not common in major cities but still happens in some rural areas) the typical Spanish working day lasts approximately from 9 a.m. to 1:30 p.m., followed by 5 p.m. to 8 p.m. Normal working hours in Spain are from 9 a.m. to 6:00 p.m-6:30 p.m. Traditionally, Spaniards take a long lunch which can be 1 to 2 hours.

Employees under the age of 18 are limited to working eight hours per day, while those over the age of 18 may work up to nine hours each day (not including commute time). This limit applies to both full-time and part-time workers.

Full-time employment is limited to a maximum of 40 hours per week on an annual basis. On average, people that work in Spain work around 36 hours.

Part-time employment in Spain is limited to a maximum of 30 hours per week on an annual basis.

Other rules that are related to working hours
  • Twelve hours must pass between the conclusion of one workday and the onset of the next.
  • You are entitled to a 15-minute recess after working continuously for six hours in a working day.
  • Your employer in Spain should give you at least one and a half days of rest every week, and this is usually Saturday and Sunday.
  • If your employer wants you to work more than nine hours a day, you must agree to the extra hours.
  • You cannot work more than 80 hours of overtime per year. This does not include overtime compensated with rest time or work carried out to prevent or repair extraordinary and urgent damage.
  • Overtime at night is illegal with very few exceptions.

Wages and salaries in Spain

The minimum wage in Spain is one of the lowest in Europe (€1.080 per month, since January 2023).

Salary rules in Spain are based on the principle of equal pay for work of equal value. With the exception of where a worker is employed based on their qualifications and experience. This means that your salary will be dependent on your job level and any additional skills you bring to the company.

In Spain, the minimum wage (SMI or Salario Mínimo Interprofesional) applies to everyone, regardless of age, gender, or employment contract.

The Spanish government adjusts the minimum wage on an annual basis based on several criteria, including national productivity, employment levels, sustainability, and economic growth.

Employment law spain: Contracts

Paid and unpaid leave

Each year, Spain has 14 public holidays. Two of these variations are dependent on the location of the community. Employees in most cases are entitled to at least 30 days of paid vacation each year unless a labor contract or agreement has been negotiated. August is the most popular month for vacations, although they may also be taken in July or September

The following are the national, religious and public holidays (bank holidays) in Spain:

  • 1st January: New Year
  • 6th January: Epiphany
  • Good Friday and Easter Monday: Either late March or early April
  • 1st May: Labour Day
  • 15th August: Day of the Assumption
  • 12th October: National Holiday of Spain
  • 1st November: All Saints Day
  • 6th December: Spanish Constitution Day
  • 8th December: Immaculate Conception
  • 25th December: Christmas Day

Sick pay in Spain

In Spain, the sick pay allowance is available for a maximum of 365 days, with an option to extend it another 180 days if you expect to get well during that time.

An allowance of 60% of your salary is given by the social security office from day 4 to day 20 of the sick leave. An allowance of 75% of your salary is given from day 21 onwards.

To obtain sick pay, the employee must have a medical examination by a doctor from the Servicio Público de Salud (State Health Services).

When you are employed by a company, your employer will be in charge of applying for sick leave. They will cover the costs of the first fifteen days. After that, the social security office will take over the payment.

Maternity and Paternity leave

The right to maternity and paternity leave is an important employment law in Spain. New parents in Spain (as well as surrogates and adoptive parents) have the right to 16 weeks of maternity and paternity leave in Spain.

If a mother wants to take more maternity leave beyond the 16 weeks, she has two alternatives: a reduction in shift duration until the kid is twelve years old, which will result in a pay cut dependent on the proportion of hours worked, or an “excedencia por maternidad”. That special maternity leave is an unpaid parental leave, usually for up to three years. Your employer must keep you on during this time, but they are not required to give you your previous job after one year.

The first six weeks following the birth of a kid must be observed by both parents; after this time, each parent may take care of him or her in any way he or she wishes until the baby is one year old.

The mother who is carrying can also take maternity leave beginning at 36 weeks; if her work puts her pregnancy in danger, she might be able to go earlier with a doctor’s approval.

To be eligible, the parent must be registered in the social security office and have paid into Social Security for at least 180 days during the previous seven years or 360 days throughout their working life. The parent will have the right to 100% of their wages.

Protection from workplace discrimination

Throughout employment, discrimination is not tolerated by Spanish law. This includes discrimination on racial or ethnic origin, religion or belief, disability, age, or sexual orientation.

Direct discrimination, indirect discrimination, harassment, and victimization are all examples of unlawful employment practices.

Even if the employer is unaware of an employee’s conduct, they may become responsible for any unlawful actions carried out by that person during their employment. The employer can only limit their responsibility if they show that they had implemented all feasible measures to avoid what happened.

The employment law in Spain does allow positive discrimination is legal in Spain (for example, imposing a constraint requiring the number of female workers to exceed a certain proportion).

Protection from sexual harassment

Both sexual harassment and harassment on the grounds of sex will constitute discrimination in all circumstances.

Employers are responsible for paying accurate and adequate compensation in proportion to the harm caused.

Employers are required to provide equal treatment and opportunities for all genders and variations in sexual orientation. To do so, they must implement strategies to prevent any type of sex-based workplace discrimination.

Health and safety representation

Safety and health representatives should be in place in Spain at all businesses with more than five employees. Current employee representatives choose them. More prominent corporations (50 or more workers) participate in employer-based health and safety committees.

It’s possible to create a joint health and safety committee that covers all of the business’s locations. However, this is dependent on the employer and staff agreeing on terms, which determine the authority of this combined body.

The health and safety representatives have a variety of tasks such as.

  • Working with management to enhance risk prevention action
  • Encourage and promote employee participation in health and safety laws.
  • Ensure that the company’s safety and health standards are met.

They also have certain rights such as the right to talk to employees about safety, receive information from health and safety professionals, and the right to encourage the employer to take action on health and safety issues.

Training and development

One of the social security benefits in Spain is vocational training. The vocational training is for both companies and workers in Spain. It is an initiative that helps them work together to create jobs. Both the central government, the autonomous communities, leading business associations, and trade union organizations all work together to help train people and get them better jobs.

The amount of this training credit will depend on the amount of the vocational training contributions paid in by each company in the previous year. Companies shall contribute with their resources to the financing of their workers’ training with a variable percentage of 5% (for companies with between 6 and 9 employees), 10% (10 to 49 employees), 20% (50 to 249 employees) or up to 40% (250 or more employees).

Making a complaint as a worker in Spain

What can you do if you feel your rights as a worker in Spain have been breached? It depends on the circumstances, but some options may include: filing a formal complaint to human resources or management and filing an official claim at the labor inspector’s office.

When the latter is chosen, the labor inspector will investigate the matter, and they will issue a court order if they feel you were in the wrong.

If management imposes disciplinary measures on you, it is possible to file a claim with the Spanish Labour Court. If your claim is accepted, it may result in reinstating your employment or compensation.

When you want to make a complaint as a worker in Spain, and you want advice on employment legislation, you should contact an employment lawyer to assist you.

Social Security and Tax in Spain

Both employees and companies employing are obligated to pay taxes such as social security contributions.

While depending on the contract, employees generally pay 6.35%, and employers pay 29.90% (January 2021). Next, employers pay a variable rate for occupational accidents (for example, they pay 1.5% for office work).

The general contribution rates as of January 2021 are 6.35% for employees, depending on the type of contract, and 29.90% for employers, plus a variable rate for occupational accidents (e.g. 1.5% for office work).

Termination and notice period

A termination must be based on one of the causes outlined in the Spanish Workers Statute. The employer needs to make sure unfair dismissal does not occur.

When an employer decides to fire a worker, strict formalities must be followed. These include a dismissal letter, notice period, and salary liquidation.

Disciplinary dismissal

No notice period is required in case of disciplinary dismissal. Disciplinary dismissals include misconduct, lack of necessary licenses, failure to attend work without permission, contract violations, and substance abuse that affects the employee’s work. There are many more reasons for disciplinary dismissal. We suggest speaking to a lawyer if you are unsure about your situation.

Objective dismissal

An objective termination is one based on objective grounds. Objective grounds include redundancy, organization changes, and restrictions in the company (e.g. closing a department and dismissing all employees working there), re-organizing activities, ending of contracts by both parties and other objective reasons for employees to be let go.

A termination letter can communicate reasons for objective termination, but the employer should have ample proof that these reasons are valid. The employee may dispute dismissal through labor court if they disagree with the reason for being let go.


Termination by resignation or by expiration of a temporary employment contract is straightforward and does not pose complex issues under employment law in Spain.

Tax Wages in Spain

Unemployment benefits

The unemployment benefit the employee receives when they lose their job depends on the length of employment.

To qualify for unemployment benefits in Spain, they must have worked and paid Social Security contributions for a minimum of one year (360 days).

For the first 180 days of unemployment, they will get 70% of that average and then 50%.

The amount of unemployment compensation they receive is calculated by comparing their past earnings (not including overtime) to the average salary for which they made contributions during the previous six months.

The employee must be unemployed when they submit their application. They will remain unemployed during the period in which the claim is processed, and they must continue to meet the requirements for receiving benefits.

If there are no contributory requirements to qualify, workers are entitled to severance pay of two days’ wages per year worked, up to a maximum of 12.

There are several causes for which unemployment benefits may be taken away:

  • Rejecting a job.
  • Working for another person or being self-employed while receiving unemployment benefit.
  • Failing to submit a new employment request with the Spanish State Employment Service on time.
  • Failure to visit the collaborating recruitment agencies, as well as failure to submit the certificate of having done so.
  • Failure to participate in social collaboration activities, job opportunities, or career advancement.

Employment law in Spain

The sources of employment law in Spain

Employment law in Spain is the branch of Spanish Law that regulates the relations between the employer and the workers and the activity of unions and the action of the State, especially in matters of Social Security in Spain.

The sources of Spanish Labor Law are the Constitution, international treaties, Community Law, Laws and regulations, Collective Agreements, labor customs as well as other supplementary sources. Those with the lowest rank expand or improve the rights of workers considered as a minimum in the higher rank standards.

The Spanish labor laws have a retroactive nature, this means that they apply to relationships that are carried out from the appearance of the norm and also those that existed before them.

Internal sources

The Constitution, as the supreme norm of the Spanish State, includes a series of precepts of a labor nature as well as general principles with application in the field of work. Among the provisions of a labor nature, it is worth highlighting:

  • 28.1: Includes the right to organize.
  • 28.2: Includes the right to strike, extended by RD-L 7/1977, on labor relations.
  • 35: Right and duty to work and to sufficient salary.
  • 37: Right to collective bargaining and to take collective conflict measures by workers (and employers)
  • 149.1.7º: The State has exclusive competence over labor legislation; without prejudice to its execution by the bodies of the Autonomous Communities.
  • 7: Trade unions as organizations for the defense and promotion of the labor and social interests of workers.
  • 1: Spain is a social State.
Organic Laws

On Freedom of Association:

Law 3/2007: For the Effective Equality of Women and Men. It establishes the legal framework to achieve the effective equality of women and men.

Law of Prevention of Labor Risks: Regulates the measures and activities necessary for the prevention of risks derived from work.

Royal Legislative Decrees
  • Consolidated text of the Workers’ Statute Law: It is the basic norm in labor matters and regulates basic labor rights and duties, as well as the fundamental aspects of the employment relationship.
  • Consolidated text of the Labor Procedure Law: Regulates the procedure to be followed in individual and collective disputes.
  • Consolidated text of the General Law of Social Security: Regulates the right to be protected by the Social Security system in situations of necessity.
  • Consolidated text of the Law of Infractions and Sanctions in the Social Order: Regulates infractions and penalties in labor matters
  1. Numerous, among others: Royal Decree establishing the minimum interprofessional salary, Royal Decree on special working hours.
  2. Collective agreements: Agreements between representatives of workers and employers, in which the working conditions of the workers included in its scope of application are established.

External sources

International associations have been created to define common working conditions for all workers in the world. This contributes to the internationalization of Labor Law, which is of interest both to the States and to the workers and employers. The reason is that, with a globalized economy, those countries who produce cheaper by exploiting their workers will have advantages over those who apply labour legislation.

To harmonize working conditions, the ILO is born (International Labor Organization). Spain belongs to the ILO, and also to the European Union, which seeks to harmonize the social laws of the Member States, as well as employment policies.

The external sources are:

  • Community Regulations: Community law is directly applicable in all European Member States.
  • Community Directives: These rules imply an obligation regarding the result to be achieved, but they require an internal standard of adaptation for their entry into force in the Member states. However, exceptionally, when its content is clear and unconditional, it must be applied directly.
  • ILO Conventions: Those that are part of the legal system of the member countries when they are ratified by them.
  • International Treaties or Agreements (bilateral or multilateral): In labor matters, these are agreements between two or more States whose purpose fundamental is for the labor protection of migrant workers.

Hierarchy of Labor Rules

  1. Directly applicable community rules
  2. Spanish Constitution (CE)
  3. ILO conventions and international treaties or conventions (bilateral or multilateral)
  4. Organic Laws
  5. Ordinary Laws and Norms with The Force of Law
  6. Regulations
  7. Collective Agreements
  8. Employment contracts
  9. Labor Custom

The Labor Administration: It develops labor policy through different bodies:

  • The Ministry of Labor and Immigration is the one that manages state policies regarding labor relations, employment, and the management of Social Security. For this, it has specialized agencies.
  • The Employment or Labor Councils of the autonomous communities manage the competencies that have been transferred to them.

Worker rights in Spain

Need a labor lawyer in Spain?

Our lawyers have practical experience in resolving employment law disputes. If you need employment law advice in Spain, then choose SpainDesk’s employment law service. We provide an effective solution and the fastest result to solve labor issues. What do our clients get from us?

  • We do employer and employee representation.
  • We can create and analyze employment contracts.
  • We can declare social security and payroll administration.
  • We advise on your problem under the law.
  • We draw up a claim and prepare all the necessary documents.
  • We collect and prepare documents for submitting a written application to the court.
  • We create a competitive application.
  • We handle all necessary complaints, claims, inquiries, and petitions of labour issues.
  • We develop an effective strategy to protect the client’s interests.
  • We prepare attractive arguments for the client’s protection in court.

If you want to hire a lawyer for employment legislation in Spain, consult our SpainDesk professionals and get legal guidance as soon as possible.

Disclaimer: Information on this page may be incomplete or outdated. Under no circumstances should the information listed be considered professional legal or financial advice. We highly recommend seeking guidance from a legal or financial expert if you lack extensive knowledge or experience dealing with any of the procedures outlined in these articles.

Every business needs legal support from the time of registration until the completion of activities. A business lawyer is a highly qualified legal service expert that handles all legal matters. A lawyer is responsible for collecting taxes from counterparties, participating in arbitration courts and resolving disputes. Today, a business lawyer in Spain has great importance because of every businessman’s desire to connect with the best legal firm.

A business lawyer can independently change tax legislation to prevent violations and be able to prepare financial statements on behalf of clients. At SpainDesk, you will connect with a professional business lawyer in Spain, who gives guidelines in the legal matter of business.

A lawyer who has expertise in business law is an expert in many legal matters as a privileged interlocutor of companies, for instance, commercial law, intellectual property, real estate, employment law mergers and acquisitions. Our Business lawyer is the essential desire of every business because legal issue occurs in any part of life.

How does our legal business service work?

A business lawyer is a professional who deals with regulatory matters in the corporate sector. A lawyer must give a good response to his client, so it’s easy to develop a trust level. SpainDesk is a legal firm that has an expert team of business lawyers, and they fulfill several types of missions, like:

  1. Give advice: our business lawyer guides all the strategic decisions of your business. We also give up to date with the regulations in force, the business lawyer in Spain ensures to develop a good reputation for our customers in the market.
  2. Preparation of business contracts: our business lawyer also specialized in corporate law for creating drafts for commercial agreements.
  3. Proper Litigation: At the time of the dispute, you might concern about the contract execution process, so you don’t need to worry at all because our business lawyer gives proper assistance before going to the commercial court.

What are our main missions for business law?

Are you finding a reputable business lawyer in Spain? When you consider SpainDesk, you will consult with our best business lawyers who speak the English language and can communicate clearly. Following are some offered services:

  • Legal security of business: Before you implement your business, you must focus on the legal proceeding of your business like contractual law, partnership or registration process. For legal security, you need to hire our service. Our expert enforces all the legal processes through a legal contract.
  • Materialize structural reorganizations: Legal support is the backbone of every business. There are many phases when you desire to hire a business lawyer in Spain, for instance, reorganizing the distribution of capital, changing the legal form of the company and managing mergers. When a business is stuck in a difficult situation, only the SpainDesk business lawyers have the solution to your problem.
  • Protect the intangible assets of the company: It’s good advice to save your precious intangible assets through a legal proceeding. Somehow, we must protect intangible assets.
  • Allow financing activity: We understand that the legal terms are denser than obtaining credit from the bank in any business case. At this point, our expert business lawyers will use their mastery of stock market, financial and banking law.
  • Secure relations with the tax authorities: Conflicts with the tax authorities, while following company declarations, whereas tax audit is also part of almost every company. Our specialized lawyer will use his knowledge of tax law to defend our client’s business situation.

Which law does a SpainDesk business lawyer follow?

  • Industrial property law and trademark law defend the intangible assets of companies
  • Banking law of payment instruments
  • Financial law helpful for all credit and activity financing issues including stock market law
  • Labor law, for all relations with the company’s employees and their representatives

SpainDesk offers affordable legal services with complete guidance. Also, we handle labor or lease disputes that often arise in any company’s activities. Righteously, every company has a strong relationship with business lawyers, but they only hire temporary, rather than full-time.

If you want to hire a business lawyer in Spain, consult SpainDesk.

Business attorney in Spain

Every business owner can come into a situation where hiring a business attorney is a good idea. A business attorney can handle all legal matters and that can save you from legal complications. At SpainDesk, you will get the best service of a business attorney in Spain. We are here to provide legal support and are ready to help our clients at any time.

We understand that businessman’s time is precious, and they didn’t have enough time to manage the legal proceeding. A business lawyer draws up all the documentation processes and approves it from the court under the right circumstances.

SpainDesk offers the best business attorney service on various issues related to entrepreneurial activity and provides services of defense in court, drafting documents, and statements of claim. What will you get from SpainDesk business attorney service?

  1. Legal advice for businesses, whether small or large
  2. Drawing up any type of contracts
  3. legal analysis of possible transactions
  4. Representation in arbitration courts, if necessary;
  5. Support for complex transactions
  6. Timely information for the process of the case
  7. Legal analysis through the prism of the client.
  8. Survey business consequences

Our business lawyer has enough experience to handle legal matters for all entrepreneurial activities. Our professional business lawyers advise on various issues related to business activity and provide exemplary legal service. We didn’t prefer that our clients wait for a longer time, that’s why we solve your issue within a couple of days.

Is hiring a business attorney in Spain feasible for you?

It is impossible to assess our business attorney service in a formulaic way and give a general figure. To determine the specific cost of a business attorney in Spain service, you need to contact SpainDesk legal office through our helpline number or visit the office physically.

Our expert business lawyers provide proper guidelines and offer the service that comes into the client’s budget. When you consult with us, you will significantly save money by getting the help of our lawyers specializing in business disputes.

Our lawyers are well aware and able to work with the problems of today’s business in Spain. Almost all organizations face issues from time to time that requires competent legal action. SpainDesk provides an extensive list of legal business services, for instance:

  • Arbitration
  • Rental disputes
  • Disputes between founders
  • Consulting
  • Disputes with employees
  • Drawing up internal local acts
  • Debt collection from counterparties
  • Other issues arising in business

Legal system in Spain

What will you get from us?

Our business attorneys will help you in legal matters as well as all the court proceedings if necessary. We want you to never face unnecessary legal difficulties. Our team of lawyers draws up a claim statement that proceeds in court. Our primary target is to provide a service that represents and protects the interests of your organization in court.

At SpainDesk, we handle every business attorney matter because we speak the English language, and can communicate clearly. It entirely depends on the customer’s desire to attend the arbitration court; otherwise, it is okay. Sometimes it is not possible to reach a solution peacefully at the time of resolving a dispute on your own; thus the most optimal suggestion would be to contact our professional business lawyers.

We listen to your queries and help you determine the best action. We also offer a business lawyer facility in the field of labor relations between an employee and an employer.

Our business lawyers in Spain are ready to manage the internal documentation of your company, for instance:

  • Dismissal orders
  • Absence certificates
  • Local regulations
  • Contracts

If you have any doubts when registering the employee’s dismissal, related to the observance procedure; thus, our lawyers will be able to advise you and draw up documents for the release of an employee.

We give a guarantee that we recover your business’s moral damage and handle every most challenging situation to win the case. Our main target is our client’s satisfaction, and it only comes when we complete all the court proceedings and get the desired result.

When you visit, you will get details of our legal service, and if you want to contact us, you can dial our helpline number. Also, you can consult us through our website and book your appointment with a business attorney in Spain.


If you are looking to set up a company in Spain, there are a range of questions that you will likely have. This blog post will provide answers to some of the most Frequently Asked Questions (FAQs) about Spanish Company Formation. We will cover topics such as the different types of companies available, the minimum capital requirement, the procedures for registering a company and more.

Company Formation in Spain

If you are considering starting a business in Spain, it is important to understand the process of Spanish company formation. Spain offers a favorable business climate with a stable economy, strategic location, and access to a large market.

Whether you are a foreign investor or a local entrepreneur, setting up a company in Spain can be a rewarding and lucrative opportunity. However, the process of company formation can be complex and time-consuming, involving several legal and administrative requirements. Below you will find frequently asked questions to clarify your doubts.

Company formation in Spain

What types of shareholders’ companies can be formed and recognized in Spain?

The two main types of companies that are recognized in Spain are the public limited liability company, which is called the Sociedad Anónima (S.A.), and the private limited liability company, which is called the Sociedad Limitada (S.L.).

What is the difference between a Sociedad Anónima and a Sociedad Limitada?

The main difference is that the Sociedad Anónima Company is most appropriate for large companies. In contrast, the Sociedad Limitada Company is a better fit for shareholders that do not need a large amount of capital. However, there are many other differences between the SL and SA as well.

Can I set up a company as a sole shareholder?

Yes, a single person may establish a Spanish firm, and you can be the company’s only director, administrator, and shareholder.

What is the minimum share capital required to incorporate a company in Spain?

The minimum share capital will depend on the type of legal entity you adopt. For the Sociedad Anónima company, the minimum share capital is € 60.000, while the Sociedad Limitada costs € 3.000.

Can I start a different enterprise in Spain through a limited liability company?

Yes, a limited liability company can accommodate almost any type of investment. However, sectors such as pharmaceutical, fund management, insurance, or banking must be carried out through a Sociedad Anónima. Please contact us for help with your incorporation.

Do I have to be a Spanish citizen to incorporate a company?

No, foreigners can incorporate a company in Spain. However, you will need a unique identification number (NIE) to carry on with the process.

How long does it take to incorporate a company in Spain?

Incorporating a company in Spain usually takes 3 weeks. However, it depends on the complexity (i.e NIE requirements and shareholder’s nationality). Also, the timing of the case, bureaucracy, appointments, and validating documents can increase this quite a bit. We can help you speed up this process and reduce your waiting time.

Do I need an address in Spain?

Yes, all companies need a registered address in Spain. If you don’t have one, SpainDesk can provide you with a service address. This is for collecting mail from the tax authorities. We can help you get a post box address, that will forward all your mail to another place without you having to be there physically.

Can I form a company in Spain under a parent company?

Yes, you can, we can register this for you in the by-laws. We can also assist you in reducing your tax burden by advising on the best approach to move funds from the parent firm to the new Spanish business.

What type of company formation is best for a foreign investor?

The private limited company, also known as the Sociedad Limitada (S.L.), is a good option in most cases since it can be run through a foreign country.

Are there any restrictions for foreign investors in Spain?

There are very few restrictions for foreign investors in Spain. However, non-European residents are not permitted to invest in certain critical sectors, such as telecommunications, without a special permit. The labor market, on the other hand, is subject to greater regulation. The maximum working week is 40 hours, and all employees are entitled to six weeks of paid vacation a year.

How old do you have to be to form a company in Spain?

A person must be 18 years old to do a legal Spanish company registration.

Company formation in Spain

What languages does the Spanish government require me to use?

In general, the Spanish government communicates with companies in Spanish. It is, therefore, a good idea to have someone take care of your business in Spain, if you are not familiar with the language.

Do I have to come to Spain for my new company?

No, this is not necessary. We can schedule a meeting with the Spanish consulate in your country, and you’ll be able to sign for the company at a notary in your home country.

What is the procedure for opening a bank account under my company?

A certificate of registration with the Commercial Registry is required to open a business bank account.

How easy is it to recruit staff in Spain for my company?

Recruiting staff and employees is not as easy as in some other countries. It can be difficult to find the right people, and the amount of paperwork is quite extensive compared to other countries. The laws for recruiting and firing staff also make this process very complicated and time-consuming. Payroll rules are different in Spain from other European countries.

What documents will be issued to me after setting up a company in Spain?

The Spanish Mercantile Registry will issue a certificate of incorporation and a document confirming the identity of the company’s shareholders.

What are the company statutes and can SpainDesk take care of them?

The company statutes or the memorandum of association is the internal rule book for your company. It includes how shareholders, directors and board members are selected and the duties, rights and privileges each holds. It also includes rules for taking board resolutions and managerial decisions. We can sign the company statutes at the notary for you through the power of attorney.

Do I have to open a company in Spain if I already have a foreign company?

If you are doing business in Spain, you will probably want to form a company in Spain. It can be a branch of a foreign company or a new Spanish business.

What is the best way to find out more about Spain’s company registration?

Our corporate lawyers are here to help you with your questions. They can answer any questions you might have and give advice on the best way to proceed. We recommend that you consult your lawyer before doing a Spanish company registration, and reach out for help if you encounter any difficulties before starting up.

Do I need a registered office for my company formation in Spain?

Yes, a registered office is a requirement in Spain. This can be an address or a PO Box number and is the place where official notifications for the company are sent to.

What are the main issues I can run into when forming a company in Spain?

Going through the incorporation process for a new company in Spain can be a complex process. Below are some of the issues you can face when forming a company.

  • The complex process of incorporation can be confusing without the help
  • Spanish bureaucracy can be time-consuming
  • Not being properly registered in the mercantile register
  • You need to perform the steps in the right sequence

What are the main requirements when setting up a company in Spain?

The company law stipulates that:

  • You will need to have company statutes
  • You will need an address in Spain
  • You will need to go through a notarial procedure
  • You will need a company deed
  • You will need a company director
  • You will need a share capital, in the case of a Spanish SL this is 3.000 euro

Need help with your company formation in Spain?

If you want to start your company in Spain, we offer a full range of services to help you from the beginning, including company formation, business taxes and legal advice.

SpainDesk can help you with all the paperwork and procedures involved in setting up your business in Spain. We provide ongoing support and advice as your business grows. Contact us today

Disclaimer: Information on this page may be incomplete or outdated. Under no circumstances should the information listed be considered professional legal or financial advice. We highly recommend seeking guidance from a legal or financial expert if you lack extensive knowledge or experience dealing with any of the procedures outlined in these articles.

Spanish companies offer various competitive advantages compared to many other business entities in other countries. With many incentives for foreign investors, establishing a company in Spain can be a tax-efficient and profitable way to conduct business in the EU and beyond. As much as S.A. companies (or Sociedades Anónimas) and S.L. companies (or Sociedades Limitadas) have many similar characteristics, the two most common types of Spanish business entities are not quite the same.

Sociedades Limitadas is the most commonly used business entity option due to organizational flexibility and minimal capital requirements. That being said, the most preferred choice for an investor primarily depends on the expected business activities in Spain. Let’s explore the ins and outs of Sociedades Anónimas and Sociedades Limitadas in Spain.

SpainDesk makes your company formation easy, fast, and worry-free.

Share capital difference between SL and SA

Share capital contributions can be in a wide array of assets including cash, credit rights, and real estate property, among others. S.A. companies (or Sociedades Anónimas) are designed for medium to big enterprises. In this regard, they have a minimum share capital of 60,102 Euros, 25% of which must be paid up during incorporation. The remaining 75% may be settled within a timeframe stated in the company’s bylaws.

For SA companies, owners are free to transfer shares. However, the company bylaws may establish some additional requisites. On the other hand, Sociedades Limitadas require a minimum share capital of at least 3,006 Euros. This must be fully paid before company formation. When it comes to sharing transfers for SL companies, Spanish law provides some limitations concerning the transfer of company shares to third parties. Such limitations may vary depending on the bylaws.

Company bylaws difference between SL and SA

One of the profound differences between SL and SA in Spain is with regard to company laws. SL usually have flexible bylaws. In this regard, the company can contain some variations from the legal regime. On the other hand, SA companies have rigid bylaws in that there are minimal possibilities of having variations to the legal regime.

The company bylaws dictate the attendance and majorities at shareholders’ or partners’ meetings for both S.A. and S.L. It’s worth mentioning that S.A. usually has several calls while there is only one call for S.L.

Company ownership

Sociedades Anónimas and Sociedades Limitadas both require a minimum required appointments of 1 director and 1 shareholder, who can be of any nationality and residence. One of the profound benefits of Spanish S.L. is that the shareholders are liable for the company’s debts only to the extent of their share capital contribution. Also, the business entity allows registration with 100% foreign shareholders.

It’s worth noting that the legal structure and mechanisms to establish and operate an S.L. are less complicated than those of an S.A. It’s thus not surprising that S.L. is ideal for small or family-run enterprises.

Who can start a company in Spain?

Regardless of whether you are a foreigner or a Spanish citizen, you are allowed to start your business in the country. That being said, you have to be a Spanish legal resident. The process can get complicated depending on your region of origin.

When it comes to foreigners, the process of starting a business in Spain is especially straightforward for persons from the European Union.  You are legally required to have NIE and EU registry certificate and then you can start the registration process. Non-EU citizens need a working visa to start a business in Spain.

If you are a foreigner looking to establish a Sociedades Anónimas or Sociedades Limitadas, you might want to consider some business factors including the industry and kind of business the company will conduct, nationality of the owners and employees, and existing trade agreements or relationships.

Company compliance

Every Spanish company is legally required to maintain proper books of accounts. Also, companies must prepare audited financial statements. However, Sociedades Anónimas don’t need to submit to an internal audit. Following Spanish tax laws, every company has to file annual corporate income tax returns.

As a company operating in Spain, you are subject to Spanish social security requirements. Also, you might need particular permits depending on your business activities. More often than not, company compliance is handled by local advisers at a minimal cost.

Separate regions may have varying rules, costs and availability. In this regard, we highly recommend consulting relevant professionals, for example, business advisors, legal experts, accountants and others based on your needs.  Get in touch with SpainDesk and we’ll go through your specific situation, so you know exactly where you stand in terms of legal compliance.


The Spanish tax regime is similar for both SL and SA companies. Taxation for companies in Spain primarily depends on the kind of enterprise you are running. Corporation tax in Spain is usually levied on the worldwide profit realized by the company.

It’s worth mentioning that new companies in Spain benefit from various tax breaks. For example, Spanish limited companies pay a 15% tax on a profit below €300,000 within their first year of operation. The tax is usually 20% on all profits above the €300,000 threshold. After two years, limited companies are liable to pay a general tax rate of 25%.

Dissolution of Spanish Companies

In case the shareholders of Sociedades Anónimas (SA) decide to dissolve the company, the agreement of the company dissolution should be published in the Official Bulletin of the Mercantile Registry and the newspaper. This is not necessary for the SL.

Steps to Registering a Company in Spain

So, what are the specific legal steps when forming a company in Spain? Let’s take a brief look:

Step 1

First, you have to register a company name at the National Mercantile Register. At this point, the relevant authorities will make sure the name chosen is unique. In case the company name is taken, then you have to choose a different one.

Step 2

After successfully registering the company name, you subsequently start drafting the company statutes and by-laws. You can choose to hire a professional to help with this.

Step 3

Get a temporary tax ID number (CIF) for the company.

Step 4

Communicate with the notary. At this point, you review all the necessary documents. Subsequently, all the shareholders or their representatives must sign the necessary documents at the notary’s office.

Step 5

Making payment for transfer tax and stamp duty

Step 6

Company registration process at the local mercantile registry. The company information is then published in the Mercantile Registry’s Boletín Oficial.

Step 7

Finally, you can acquire a permanent tax ID number (CIF) for the company. The entire company incorporation process typically takes 3 weeks. For foreigners, you can choose to avoid the trip to Spain by giving a legal professional of choice the power of attorney.

Due diligence when starting a Spanish company

The majority of local and foreign investors in Spain prefer SL, primarily because of the lower investment needed. Also, company management is much more flexible. That being said, large companies and multinationals may find an SA ideal for their business.

Are you ready to start your investments in Spain? SpainDesk can register the company on your behalf, without even the need to travel to Spain.  As an investor, you want to make informed decisions, especially regarding the best corporate structure for your firm. We provide a one-stop shop where you can get all the relevant formalities done professionally and hassle-free!

There are many steps involved with creating a company in Spain. We can make it easy for you with our company formation service. Next to this, we offer legal and accounting services. This way you can focus on your business. Contact us for an appointment with our team.

Disclaimer: Information on this page may be incomplete or outdated. Under no circumstances should the information listed be considered professional legal advice. We highly recommend seeking guidance from a legal expert if you lack extensive knowledge or experience dealing with any of the procedures outlined in these articles.

SpainDesk makes your company formation easy, fast, and worry-free

The Spanish company registry, or “Registro Mercantil“, offers transparency and allows the public access to information about companies in Spain.

An owner of a company can’t keep the information about his business a secret, everybody can find out basic data such as the name of the company, its activity, its managing director, and its shareholders.

Questions about Company Registry Spain

Company Registry Spain: Doing a Company Search in Spain

What is the Spanish Company Register?

The Spanish company register is a public registry that records the information of all companies in Spain, including sole traders (freelancers).

Who can search the Central Mercantile Register?

The public registry is open and accessible to anyone, regardless of whether they want to search for a specific company or check out how their competitor is doing.

How to register your company with the Mercantile Registry?

When forming your company in Spain, you will need to register it with the Spanish company registry. The first step for registering a business in Spain is getting your NIF (CIF), an identification number that will be used by the commercial registry as well as the Spanish tax office.

How does the Registro Mercantil work?

The Registro Mercantil collects and stores the basic information of all Spanish companies. It offers transparency and allows the public access to information about every business, from small units to large corporations.

The Spanish company register is open to the public, so everybody can find out basic data about a business entity that interests them. You can search for companies in the Spanish company register by name, industry, and location.

What can you do at the Registro Mercantil?

There are many things you can do there, depending on what you need.

  • When you want to start a company

    The first step in starting a business in Spain is to go to the Central Mercantile Registry and request a name. If you are not sure if your name is taken you can have a look in the Spanish Commercial Registry to see if it is available.

  • If you want to know if a company is active

    You can either search for the company by name or NIF number (CIF). If you are searching by name and it’s not available, try adding an ‘S’ at the end of the name. This is, if you are searching for “Sociedad de Gestion”, try also searching for “Gestion S” or simply, “Gestion”.

  • If you want to know the directors and owners of a specific company

    You can also search by name and NIF number (CIF). If you don’t know the exact name use one or two first letters and choose between “Possible Individuals” or “Possible Legal Entities”. Notice that you can only access information about individual people if you have a legitimate interest.

  • If you want to check the company’s solvency and creditworthiness

    You can request their balance sheet which will show you all of their assets, liabilities, credits, and guarantees in addition to the names of the current directors/owners.

  • If you want to check if a company is registered or not

    You can search for its entity number which will tell you whether the company was successfully formed and is currently active, inactive (dormant), dissolved (liquidated), or bankrupt.

  • If you want to know which companies operate in certain industries or specific business activities in Spain

    The company register also offers lists of companies in certain industries, for example, the list of companies operating in different areas (districts) throughout Spain, or the list of car dealers.

How can a company register with the Registro Mercantil?

To establish a company in Spain, you must file it with the Registro Mercantil Central. The method of company formation in Spain is guided by a set of paperwork that must be signed by the company’s officials. Among these are the information of the shareholders, and articles of association. If you need help with company formation we can help you. Contact SpainDesk.

Company Registry Spain: Doing a Company Search in Spain

What types of companies are registered in the Trade Register in Spain?

The mercantile register regulations require every company in Spain to be registered here. The most frequent type of business entity registered in Spain is the limited liability company. This business form offers some of the best conditions for entrepreneurs and may be used for a wide range of commercial purposes. Other popular company entities that you can find in the Spanish central mercantile register are sole traders, partnerships, and public limited companies.

Types of company registers in Spain

You can find company information in different places. Below are the most popular types of registers that you can look for companies in:

  • Registradores: This type of register is the most widespread and populous, so it’s useful if you want to find information about companies in certain areas (provinces).
  • RMC: the commercial register in Spain is a database with all the companies which have an R.M.C. number. You can obtain this information by going to any local commercial registry office or requesting it from the Spanish Commercial Registry (RMC).
  • BVDinfo: This website provides a list of all companies registered with the Spanish Trade Registry. You can find the company code, its NIF number, and date of registration, among other data.
  • EBRA: The European Business Registry Association (EBRA) is a database similar to the Spanish commercial register. It offers company data in all EU member states.
  • Infoempresa: Infoempresa is a website with information on companies and business activities. It also includes the list of companies operating in certain areas (districts) throughout Spain or the list of car dealers.
  • this is another website that provides information about companies operating in Spain. You can find clearly what kind of information is included on their website.
  • Info-clipper: Info-clipper is another site with company information on Spanish companies. It also offers information about companies from other countries.

As you can see there are many options to find information on companies in the Spanish central company register. The official Registro Mercantil is a safe choice. However, other sources might have more information available.

How reliable are the documents in the Spanish Company Register?

The central commercial register in Spain is public and open to all, so anyone can request information about a company. In general, the data is reliable and authentic, especially when it comes from a governmental source like the Central Registro Mercantil.

Still, sometimes we come across information that we believe is inaccurate or outdated. We also see some cases where the documentation on a company isn’t available, even though they are legally required to keep it up to date and accessible to everyone. This can happen because of database errors or a company incorporation process that went wrong.

What are the costs involved with the company register?

There are small costs involved in accessing several of the services offered by the company register. Depending on the number of companies you want to see, the price will increase. The price can also increase when you want to find different types of company documents.

What company documents can you find in the company registry?

Company documents you can find in the mercantile register are:

  • Company financials such as the filing of annual accounts and legalized official books. Balance sheet, income statement, annual report, changes in equity, and cash flows.
  • Registered office
  • Brands under company
  • Social capital
  • NIF-IVA number
  • Representatives, directors, attorneys, and contacts
  • Stock data for listed companies
  • Original filings/images
  • Detailed corporate structures
  • Business activity

What do you need for a company search in Spain?

You can search for Spanish companies by company name, key officers, NIF (CIF) number, finance, and even by business activity. If you need to know what kind of company is this and its legal status you will find the required information in the National Company Register (Registro Mercantil).

Disclaimer: Information on this page may be incomplete or outdated. Under no circumstances should the information listed be considered professional legal or financial advice. We highly recommend seeking guidance from a legal or financial expert if you lack extensive knowledge or experience dealing with any of the procedures outlined in these articles.

Opening a new office? With the right planning and execution, it can be a very successful move for your business. Here are a few tips to help make sure your new office is off to a good start.

1. Evaluate the need

Opening a new office abroad can be challenging, especially for companies that are not familiar with the local business landscape and regulations. To successfully establish an overseas presence, it is first important to evaluate why you need the office in the first place. Some key considerations include:

  • Is there potential for growth in the market?
  • What is the level of competition?
  • What are the business regulations?
  • Are there any existing trade barriers?

To get an idea you can research market research reports, speak to other companies that are already operating in the market, or hire a consultant to help you evaluate your options.

2. Legal and tax considerations

Establishing a new office in a foreign country can be a complex process, and there are several legal considerations that must be taken into account.

First of all, it is important to obtain the necessary permits and licenses from the local authorities.

Additionally, it is essential to comply with all applicable tax regulations, failure to do so could result in severe penalties. Therefore it is a good idea to get accountant services on board to help with this.

Furthermore, it is important to ensure that all of your employees have the proper work visas and other documentation before they begin working in the new office.

Finally, companies must also be aware of any employment laws that may be applicable in the new country. For example, there may be restrictions on hiring foreign workers or specific requirements for providing employee benefits.

It is advisable to consult with a local attorney to ensure that you are taking all of the necessary legal steps to establish your new office. They can assist with the company formation, obtaining the required licenses and permits, and drafting any necessary employment contracts.

2. Research the cost of opening an office

An important step is to research the cost of opening an office in your target location, including all essential expenses such as rent, taxes, and equipment costs.

You will also need to assess the feasibility of staffing your office with local employees versus hiring workers from your home country or outsourcing some or all of your administrative functions.

Additionally, you should think carefully about how to manage your budget so that you can maximize efficiency while minimizing expenses. By taking these steps early on, you can rest assured that you have calculated all of the necessary costs associated with opening a new office abroad and have planned accordingly.

3. Find a location for your office

There are a few factors to keep in mind when searching for office space abroad.

First, consider the amount of space you will need and the type of layout that will best suit your needs.

Then, take into account the accessibility of the location, both for employees and clients.

It is also important to consider the cost of rent and utilities as well as any special permits or licenses that may be required. The cost of living surrounding the area should also be considered, as relocation can be a big expense for employees.

5. Furnish and equip your office

If needed you need to furnish and equip your office. First and foremost, you need to have an adequate amount of furniture and equipment in order to support day-to-day operations. This includes items like desks, chairs, computers, printers, and filing cabinets, as well as smaller but no less important pieces like doormats, wastebaskets, phone chargers, and extension cords.

Additionally, it is important to account for any specific needs that your employees may have based on their roles within the organization. For example, if you have salespeople who regularly travel overseas on business trips, you should consider investing in sturdy suitcases and packing materials that can stand up to frequent use.

With a little foresight and preparation, you’ll be ready to hit the ground running once your new workspace opens its doors!

6. Hire employees

If you’re planning to open a new office abroad, one of your priorities should be to hire employees. But before you start the hiring process, it’s important to do your homework and research the local labour market. What skills are in demand? What salary levels are typical for the positions you’re looking to fill? Once you have a good understanding of the market, you can start the process of recruiting and interviewing candidates.

Even if you don’t speak the local language, it’s important to have at least one person on your team who does. This will help ensure smooth communication and avoid misunderstandings with the local community. In addition, be sure to check with your company’s HR department to find out what laws and regulations apply to hiring employees in your new location. By taking the time to do your homework and plan ahead, you can ensure a smooth transition for your new office abroad.

7. Train your current employees for expansion

One important step in expanding to a new location is ensuring that your employees are prepared and trained for the transition. After all, they will be responsible for representing your business in this new environment, so they need to be fully equipped to handle any challenges that may arise.

Some strategies for effective training include providing role-playing exercises for your current employees, which gives them the chance to practice their skills in hypothetical scenarios involving coworkers or clients from the new country.

Another useful technique is giving presentations on local cultural norms and etiquette in order to help current employees understand what is expected of them during interactions with customers from that region.

Overall, by investing time and resources into employee training for an overseas opening, you are sure to reap many benefits down the road.

Acquiring a business in Spain can be a complex and time-consuming process, especially if you’re not familiar with the local market and regulations. Here you can read some of the basics that you need to know about acquiring a business in Spain.

What is a business acquisition?

A business acquisition occurs when one company buys another company. The acquiring company can buy the assets of the target company, or it can buy the target company’s stock. Business acquisitions are usually done to expand the acquiring company’s market share, product line, or geographical footprint.

What is a merger?

A merger is a combination of two companies into one company. In a merger, the two companies combine their assets and liabilities. The resulting company is typically larger and more diversified than either of the original companies. Mergers are usually done to increase market share, reduce costs, or gain access to new technology.

What are the general steps to merge a businesses

There are a few key steps in merging businesses:

1. Develop and implement an acquisition strategy

The goal is to identify what business areas are strengths for both companies and which ones can provide synergistic benefits if combined. If you’re hoping to acquire a company for its technology, for example, you’ll want to make sure that the research and development teams are compatible and can work together.

2. Evaluate target companies

The first step in any acquisition is to evaluate the potential target company. This includes looking at their financials, their products and services, their customer base, and their growth potential. You’ll also want to assess the management team to see if they’re a good fit for your company.

3. Negotiate terms of the acquisition

Once you’ve decided on a target company, it’s time to negotiate the terms of the acquisition. This includes the price, the structure of the deal, and the terms of the post-acquisition integration. This is where having a good team in place is essential, as you’ll need to negotiate from a position of strength.

4. Manage due diligence process

The due diligence process is a critical part of any acquisition. This is when you’ll verify the financials of the target company and make sure that all of their products and services are up to your standards. You’ll also want to look at any potential liabilities that could come with the acquisition.

5. Integrate the two companies post-acquisition

Once the acquisition is complete, it’s time to integrate the two companies. This includes combining operations, merging cultures, and ensuring a smooth transition for employees, customers, and other stakeholders. This is often the most challenging part of the process, but it’s essential to get right if you want the acquisition to be successful.

6. Ensure a smooth transition for employees, customers, and other stakeholders

The final step in any acquisition is to ensure a smooth transition for all employees, customers, and other stakeholders. This includes communication plans, training programs, and change management processes. If done correctly, this will help to ensure that the acquisition is successful and that everyone is onboard with the new company.

What are the benefits of a business acquisition or merger?

There are many benefits to business acquisition or merger. The most common benefits include:

  • Increased market share
  • The ability to enter new markets
  • Access to new technology
  • Improved economies of scale
  • Increased buying power
  • The ability to reduce costs
  • The ability to realize synergies

What are the challenges of a business acquisition or merger?

There are also many challenges that can arise during a business acquisition or merger. The most common challenges include:

  • Integrating the two companies
  • Cultural differences between the two companies
  • The potential for employee layoffs
  • The potential for shareholder disputes
  • Regulatory approvals

How can SpainDesk help?

Our team of experienced business lawyers and accountants can help you with all aspects of your business acquisition or merger, including:

  • Evaluate target companies
  • Conduct due diligence
  • Draft and negotiate purchase agreements
  • Analysing tax implications
  • Navigate regulatory approvals
  • Integrate businesses post-transaction
  • Negotiate terms of the acquisition
  • Manage due diligence process
  • Advising on financing
  • Navigating antitrust issues
  • Addressing employee concerns
  • Resolving shareholder disputes
  • Preparing and filing all necessary documents
  • Ensuring compliance with laws and regulations

A word from SpainDesk

Acquiring or merging with another business can be a complex and challenging process. However, it can also be a great way to grow your business and enter new markets. If you’re considering an acquisition or merger, our team of experienced professionals can help you every step of the way. Contact us today to learn more.

Invoices in Spain are an important part for Spanish tax authorities to keep control of companies’ taxes payments. They document the income and expenses of a business and play a key role in tax filings. Invoices are also a valuable source of information for businesses. They can help track spending patterns, identify areas where costs can be reduced, and assess the profitability of individual products or services.

Invoices are an essential part of doing business and should be handled with care to ensure that all required information is included. In this article, you will find information about invoice processing in Spain.

What is an invoice?

An invoice is a seller’s record of goods or services sold, the money owed for them, and any additional fees or taxes that must be paid. The Spanish word for the invoice is “factura”.

What should be on the Spanish invoice

If you operate a business in Spain, you must include certain basic information on your invoice, such as:

  • Company name
  • Contact information (address buyer and seller)
  • Tax identification number
  • Unique invoice number
  • Invoice date
  • Date the payment is due and any other payment terms
  • Acceptable forms of payment
  • Description purchased goods and services provided, including price and quantity
  • VAT Amount
  • Total amount

You must show the VAT identification number of your customers if you export goods or services to an EU Member State.

The Simplified invoice

Invoices may be simplified in certain cases (also known as tickets, credit notes, and receipts). Simplified invoices can be created when you are not invoicing a business or entrepreneur, and in the following situations:

When can you use simplified invoices?

Simplified invoices are only used when you aren’t conducting business deals with firms or entrepreneurs. You can only use them with private individuals, and in the following situations:

Amount less than 400 euros: When the amount of the invoice is less than 400 euros, the invoice can be issued in a format that is considered a receipt.

Corrective invoice: Corrective invoices are created when you need to make changes to an invoice previously sent. This type of invoice must be used when the scope or quantity of goods or services is changed, or if prices are modified, additions are made, discounts are applied, taxes change, etc. These invoices must include information about the original invoice and corrections to it.

Companies with the following specific activities: The sum of the invoice does not exceed 3000 Euro (VAT included) and are one of in the following categories:

  • Retail sales and services
  • Sale or services of an ambulance
  • Sale or services at the home of the consumer
  • Services of transportation of people or luggage
  • Clubs, hotels, and restaurant services
  • Telephone services like telephone booths or card use
  • Hairdressers, beauty schools, dry cleaners, and laundries
  • Toll roads, sports facilities, and parking
  • Services related to photographs film rental and development of photographs.

What should be in a simplified Spanish invoice

The simplified invoice should contain the same information as a normal invoice. The difference is that it doesn’t need to be registered with the Spanish revenue authorities.

  • Invoice number/ series
  • Date of issue
  • Invoice date
  • Your tax identification number
  • Description of the goods dispatched or service provided
  • VAT amount
  • Total amount

Your tax identification number

The tax identification number in Spain is a key element for the tax authorities to monitor business tax payments. It is an important requirement. When you create a business in Spain you are required by Spanish legislation to be VAT Registered.

This tax number is called the Número de Identificação Fiscal or NIF in Spanish. This number aids in the tracking of businesses’ purchases and expenses for tax purposes both domestically and internationally.

Spanish VAT legislation

Under Spanish VAT legislation, taxable persons are allowed to deduct their input VAT from their output VAT. They are also allowed to retain any input VAT paid on purchases of goods or services that relate directly to their taxable output.

VAT refunds and tax declarations

Next to this, you can request vat refunds if you are not required to pay VAT in Spain. For example, VAT refunds can be done when you are not registered as a taxable person in Spain. To deduct VAT or VAT refunds, you require to have the invoices you have produced or received.

Electronic invoices to government bodies

If you work for the Spanish government, you must submit an e-invoice. An electronic invoice is the same as a paper invoice, only it is transferred to the client in electronic format.

Minimum retention period

In Spain, you are required to hold invoices for a minimum of 5 years. After this time they can be destroyed or be recycled. You may be required by the tax authorities to send copies of your Spanish invoices to check whether your tax declarations are correct.

A word from SpainDesk

Businesses must produce invoices for all transactions, and these invoices must include certain information such as the date, the VAT amount, and the total amount. In addition, businesses must retain copies of all invoices for a minimum of 5 years.

At SpainDesk, we can help you set up an accounting system that will meet Spanish requirements. We can also help you set up your company in Spain and file your Spanish tax declarations. Contact us today to get started.

One of the key requirements for business success is having a team that can carry out your operation and provide a quality level of service and products. In this blog, we discuss the basics of recruiting in Spain. The information is relevant for people that are starting a business in Spain, or are already established, and want to hire more employees.

Jobs and the economy of Spain

The Spanish economy is the fifth biggest in Europe in terms of nominal gross domestic product (GDP). The economy has been growing rapidly for the past six years (2014-2020), with strong GDP growth rates owing to domestic demand and exports. In 2020, Spain’s economy expanded faster than it did during previous economic cycles, surpassing the European average.

The unemployment rate in Spain remains high compared to other European countries. The unemployment in Spain is between 15-16% in 2020.

Industries creating jobs

The economy in Spain primarily drives on the businesses in tourism, real estate, manufacturing, agriculture, energy industries, renewable energy, infrastructure development, banking, insurance, textile, health technology, aerospace, and the automotive industry.

Multinational organizations and international workers in Spain

Since the dismantling of the borders within the European Union, many multinational organizations have begun their operations in Spain. A large number of international companies such as Facebook, Google, Amazon, Netflix, and Uber have their personnel working in Spain.

The Spanish lifestyle, cheap cost of living, breathtaking nature, and business-friendly environment are some of the key factors that encourage multinational organizations to carry out their operations by setting up offices in Spain. They use these factors to attract personnel from all over Europe to work for them, and it is working out for them.

From 2013 to 2019 the international inflow of workers has been increasing. In 2019, there was an inflow of 660.000 workers into Spain.

Marketing and the recruitment process in Spain

The process of marketing and recruiting people to do a task is fundamental for maintaining a business running smoothly. Without the right talent, businesses cannot function at their optimum level.

The process of recruitment involves identifying the right people for a role and providing them with an environment in which they can thrive and develop as professionals and individuals.

Businesses that are having their European headquarters in Spain are often looking for experienced multilingual candidates, that can get work done in the other countries in Europe. Searching, finding, and hiring personnel for a company settling in a new country can be a difficult task, and that’s why they often get help from recruitment agencies located within Spain.

Next to the fact that recruitment agencies in Spain have vast experience to fill new jobs fast for clients settling in Spain. They also are familiar with dangerous pitfalls and great opportunities within the employment law of Spain.

Types of recruitment agencies in Spain

Recruitment agencies provide a service to both job seekers and employers. They connect the right person to a job role. For multinational companies, jobs can be filled by Spain’s workers and international workers.

Recruiting Spain Workers

Recruitment agencies that work with Spain’s workers have a national and local focus. They have the expertise in finding Spanish speaking talent by using Spanish social media and Spanish job boards.

Recruiting International Workers

For companies that need to hire international workers from outside of Spain, they can look into international recruitment agencies that specialize in recruiting people from different countries.

Spain’s Employment Laws

An excellent level of knowledge on the employment laws in Spain is necessary for established and new companies in Spain. Professional advice on working hours, drafting contracts, leave, social security, payroll, and personal data are essential to not get in trouble with the labor authorities.

Employment law differ in Spain compared to other countries such as the Netherlands, Germany, the UK, and the rest of the world. Support on this topic from a Spanish labor lawyer is therefore highly recommended.

Spain’s Work culture

Understanding the work culture in Spain can be beneficial for multinational organizations that are recruiting in Spain. Spanish workers are characterized by being friendly, open-minded, hardworking, flexible, and having good family values.

Spain’s work culture differs from other countries in Europe and the rest of the world. Understanding and accepting these differences can be a key to success for international companies that establish themselves in Spain.

The most famous work traditions in Spain are:

  • Spanish people don’t like to worry, and want to enjoy life to the fullest.
  • The siesta at 13:00
  • People don’t like confrontation and it is better not to fight but see others’ views and grow from it instead.

Understanding how Spaniards work in their environment will help companies to get the best out of their employees while providing a pleasant working environment conducive to business success.

Advising candidates on work culture

Advising candidates that are moving to Spain from all over the world on the work culture, transport, accommodation, services, cost of living, places to live is usually provided by these top recruitment agencies in Spain.

A recruitment agency that works closely with its client often provides advisory services to candidates on life in Spain before they even move to Spain. This way a higher retention rate can be expected once they are working for the client.

How do I hire employees in Spain?

Hiring someone can be done through your own company, or outsourced to a payroll company.

Only outsourcing the search of new employees

A recruiter receives no money until one of the individuals they recommend is hired.

Outsourcing the search, and payroll administration

Working with an outsourcing company means that all the paperwork including signing a contract and offering payment for services will be handled by a third party.

Are you an employer that needs help filling jobs in Spain?

SpainDesk helps with all aspects of recruiting in Spain, from helping with candidate search to payroll administration.

We have a vast amount of experience with hiring people from different countries and can help companies that need to hire international staff from all over the world.


In this article, we have explored some aspects you need to know when you want to fill jobs in Spain. We can offer you solutions for payroll in Spain. Our services include:

  • Company formation and registrations with Spanish tax and social security offices.
  • Finding the right candidate that matches your company’s needs and culture.
  • Taking care of all aspects of payroll in Spain, from reconciling payments to taking care of taxes.
  • Working closely with you or your partner to understand your business and support it in its growth throughout Spain.
  • Offering you our expertise and experience in recruitment, staffing, and payroll administration.

We also offer company formation services, and tax services to international companies that are looking for a trusted partner in Spain. Do not hesitate to contact us for more information. We are here to help you with your recruitment needs in Spain.

Spain is the ideal place for foreigners from around the globe to start their own company. Excellent infrastructures, internationally renowned talent, and an entrepreneurial ecosystem make Spain a favoured choice. Having a business idea is great, but starting a business in Spain is not as easy as it sounds. In this guide, we discuss the most important steps and answer frequently asked questions. This guide will cover all you need to know, from the company formation to the accounting and bookkeeping.

The attraction for starting a business in Spain

Foreign investors and foreign companies that move to Spain want to expand in the attractive local market of Spain. Spain has an ideal landscape with incredible weather and an affordable lifestyle. Which makes it attractive for foreign investors to start a company and employees to work at. Spain’s business culture is liberal and very open to new opportunities, and foreign investments are always welcome.

So you are ready to take the leap and start a business in Spain. Whether you have made a business plan or want to extend your parent company with a local office. The steps you should take to successfully incorporate your company in Spain are tricky and not straightforward. This blog discusses the steps needed to set your company up properly and provide answers to FAQs. Read the following simple steps that will help you navigate through the process of starting your business in Spain. After covering the steps, we will discuss what kind of businesses are popular to start in Spain.

SpainDesk makes your company formation easy, fast, and worry-free

Starting a business in Spain

Apply NIE (Foreign Identification Number)

Whether you’re an EU citizen or a Non-EU citizen, you will need to obtain your unique Foreign Identification Number /Número de Identificación de Extranjero (NIE). A foreign identification number is one that every Spanish employer and a self-employed person needs. You can get your NIE at the Oficina de Extranjeros (Foreigners Office). This process may take up to two weeks, depending on which location you want to get it.

You can get the NIE number also through the consulate in your home country or the Spanish embassy. When you are dealing with a Spanish embassy, we recommend that you make a reservation for an appointment.

Usage of the NIE number

You need the NIE number to open a business bank account in Spain, get the company formation number (NIF or Numero de Identificación Fiscal), and open a corporate business entity. It also serves as your personal tax identification code and is needed to do your personal income tax return. Doing your personal tax return is obligatory in Spain, whether you’re a business owner or not. Besides that, you need it when dealing with any government authority. It is your identification code on all kinds of governmental and medical forms.

The NIE number differs from the NIF number, a company tax identification number. Starting a company in Spain requires you to get yourself an NIE number and then apply for a NIF (company tax ID) at your regional revenue office, called Agencia Tributaria.

The NIE format has ten characters, begins with a letter and ends with a letter.

Registering a company in Spain

Getting your NIF number (Tax number)

The Spanish NIF number is the equivalent of a Company’s Tax Number and is required to start paying taxes. The NIF number is necessary for the limited legal entities and not for the individual owner of the company.

To set up a company in Spain, after you get a NIE number you need a NIF number. The NIF number helps the tax authority identify your company for all kinds of tax purposes, such as paying corporate income tax. Corporate tax is payable by the company, not by its shareholders.

The first step to get it is gathering all your personal documents. These include your passport, ID card, and NIE number. Then you fill out a NIF request and present it to a local company registry office together with your personal documents.

The application process may take between one and two weeks, but some offices are faster than others. Make a copy of everything before handing it over; they usually want the originals back after checking them. You can bring your documents in person or by mail.

Getting the NIF through the embassy can be done at your nearest Spanish consulate. Make sure to make an appointment first before heading there. The process usually takes up to 15 days to submit all the necessary documents. Make sure that you have all documents required at hand. It doesn’t hurt to check beforehand if they are up to date.

The CIF number ‘Certificado de Identificacion Fiscal’ is another tax identification number, but the Spanish tax agency replaced it with the NIF number. You can both use a CIF or NIF number to pay tax.

Local Tax Office in Spain

Choosing the type of company you want to start

After getting your Spanish tax identification number, you must choose a business form. There are many different business structures you can choose from, and the Spanish legislation already becomes tricky here. There are two main categories. The first is for self-employed individuals, the second one is limited liability companies.

The general types of legal entity structures you can choose from in Spain are:

Business structures for individuals

  • Sole trader – Empresario Individual (Autónomo)
  • Joint owned company – Comunidad de Bienes
  • Private partnership – Sociedad Civil Privada

Business structure for corporations

  • Limited liability company – Sociedad Limitada (S. L)
  • Public limited company – Sociedad Anónima (S. A)
  • Worker-owned company – Sociedad Laboral
  • Cooperative company – Sociedad Cooperativa
  • General partnership – Sociedad Colectiva
  • Limited partnership – Sociedad Comanditaria

Other unique types are

  • Branch Office
  • Private partnership – Sociedad Civil Privada

The Autónomo (self-employed worker) is the most straightforward legal regime for a sole trader or self-employed person. You will have the same liability as a natural person with this business form. It doesn’t have a minimum investment required, and you don’t need to prepare a balance sheet or an annual report. Therefore it is easier for you to deal with the Spanish tax authorities. It is mandatory for you to keep a registered book of all the issued invoices and a book of sales and income to collect all the invoices and income that you are issuing or receiving in the development of your activity. Also, if you do not have a residence permit in Spain, you can get a self-employed worker visa in some cases. In this case, though, you must show that one or more Spanish firms have signed up for your services.

The Sociedad Limitada (SL) entity is the most popular corporate legal entity for companies in Spain. The SL is also popular for foreign investors and as a parent company because of the limited liability. The company incorporation of the SL is complex and, therefore, involves a business lawyer. It has a minimum share capital investment of at least 3,000 euros. You can set it up with one single shareholder or several shareholders who all have unlimited personal liability if the company goes bankrupt. It is the go-to Spanish Limited Company.

Choosing your company name

After choosing your company’s name in Spain, it is necessary to check if someone has already used that name before. You can do this by going over all past and current trade names at the Commercial Registry (Registro Mercantil). Our service also includes this step, so you don’t have to worry about this. We only need you to think about four other possible company names. This is in case your first choice is taken.

Registering a company name

Drafting the company’s Bylaws or Articles of Association

Think about this step if you incorporate a corporation, such as a Spanish SL. When you start a Limited Liability Company in Spain, it is required for you to have company Bylaws and Articles of Association.

This document collects the essential information that will govern the operation of a company. In other words, it will include all the rules applicable to your business. Your lawyer will draft the company’s Bylaws or Articles of Association in Spanish called the “Estatutos Sociales”. Once this document is ready, you will be given your company name of choice by the Mercantile Register, and you will invest the minimum capital share (if required). The company owners will sign the Bylaws and Articles of Association before the Spanish notary.

SpainDesk makes your company formation easy, fast, and worry-free

Get a certificate from the Spanish Mercantile Registry

Registering a company with the Spanish Mercantile Registry will get you your certificate so you can do all kinds of business activities in Spain. The digital certificate is created to verify identity using an ID card or passport. It is an online identification document that will allow you to carry out any procedures, including filling in the specific document and signing it, with the Spanish Tax Authorities over the Internet.

When you have registered the company, you will receive a copy of the public deed in which your name will be listed. This public deed is also called Memorandum of Association / Deed of Incorporation. It includes, amongst others, the company name, names of the shareholders, business activities, company objects and powers, for instance, who holds the manager/administrator charge in the company.

This will make it easier if you are ever asked who owns what part, especially when someone asks for money or wants to sell their share of the company. This could also be useful should there ever be any legal proceedings against the company.

As a foreigner, you have to register your company in the Commercial Registry (Registro Mercantil) within 30 days from its foundation. To do this, all shareholders living abroad need to get their copy of the public deed authenticated by a notary who is legalised by an Apostille or legalised with the Spanish Consulate where they live.

The Spanish Tax Authority

The Spanish tax agency can also get information from the Commercial Registry (Registro Mercantil). This means that they can easily determine how much you paid for your assets, who owns what percentage and other details about your business structure. They will also be able to see what type of legal entity it is, such as a sole trader, limited company or another form.

The local tax office will also see which taxes have been paid and when. This can come in handy if you ever get audited by the tax office because they would already know all your details – saving yourself time explaining how everything works from scratch.

Open a Spanish bank account

According to the law, opening a bank account isn’t strictly necessary when you start a business in Spain. However, in the specific case of the SL, for instance, to establish the company, it is required to invest a minimum capital share of EUR 3.000. Usually, you will put this share capital on a new business bank account. Also, it makes sense since it will be easier for you to analyse your results and manage your business. In general, you can’t easily navigate your day-to-day business activities without having a bank account. The bank will only request the certificate stating the company name to open it.

Having a Spanish business bank account gives you a better overview of your costs, revenue, profits, and tax payments. Furthermore, you can get help easier on your bookkeeping by linking your account to an accountant system.

If you are looking for a bank in Spain suitable for your company, we can assist you with the whole procedure. From choosing the right bank to setting up an appointment, we can make it as easy as possible for you.

Get a Spanish sim card or phone number

When you are coming from outside of Europe, it is smart to save costs by getting a Spanish sim card or phone number. This is useful for your business since you can save money on international calls. The Spanish mobile phone market offers prepaid sim cards, which are an easy way of getting a local number and keeping the costs low compared to having an office or renting one.

If you feel more comfortable owning your landline telephone, it might be better to get a fixed-line telephone service (Servicio de teléfono fijo). However, this will cost significantly more than just using pay as you go services such as Vodafone, Movistar, Orange and Yoigo offer. You can also get a discount deal by getting the internet connection simultaneously set up at your business premises. We can help you get your Spanish sim card or phone number as well, so you are set up properly right away.

Investing in Spain

Getting a postal address/register property at the authorities

The next step is choosing an official postal address. This will be where you get all correspondence and notifications, for instance, letters from the tax authorities. Your business premises can also serve as your postal address, a post office box is also okay. Don’t confuse the postal address with your business address, which is the ‘Domicilio Social’, the place where the main administration and operation is located, not just an address for notification purposes. You only find the ‘Domicilio Social’ in corporations, not with sole traders.

It is important to use the Spanish name of your company in the registered office address. Getting a registered postal address is essential for starting a business in Spain. Our experts are ready to provide you with a solution.

Filing your Tax Declarations, Forms and Annual reports

Whether you are a sole trader, limited company or have any other business form, you must fill in certain tax forms. Different regions in Spain have different tax laws and tax rates, and therefore we advise you always to consult an experienced company formation agent.

In general, sole traders (freelancers) have the following tax obligations

In general, limited companies have the following tax obligations

  • Impuesto de Sociedades (IS) – Generally 25%
  • VAT (IVA)
  • Annual report (or ‘certificado de existencia y representación’ in Spanish)
  • Different tax forms (i.e. importing products, renting, and buying property forms sometimes have to be filled)

At SpainDesk, we have a team of tax advisors offering a wide range of accounting services, including VAT registration, audit services, the preparation of the annual financial statements, and tax minimisation solutions. Our accountants can take care of the tax compliance in Spain for you.

Next to the tax obligations, there are also other forms (Modelo’s) that may need to be filled.

Business Taxes in Spain

Set up an online accounting system at the start of your business in Spain

We can help you set up an online accounting system at the start of your business in Spain. Starting a company or opening a bank account without an idea of what’s going on in your finances is not only confusing but also risky and potentially costly for your business. Technology solutions have improved every aspect of bookkeeping. Businesses need an intelligent accounting solution that is fast and reliable.

By linking to our professional accounts team through cloud-based technology, we can make sure that you have one less thing to worry about during this important stage as well as provide more time to focus on growing your new Spanish enterprise while keeping track of all transactions and expenses.

Contact us to enjoy numerous benefits of our accounting solutions, including real-time reporting, access to an online accounting system, scan modules, and the latest financial information that aids business decisions. We can also offer you a very basic accounting and bookkeeping services package to get you started. We can understand that you don’t want to run up costs when you first start a business in Spain, which is why our basic services will provide you with the essential tax declarations and most basic guidelines that you need.

Commercial contracts for your business

There is a need of dealing with business contracts and conditions when starting a business in Spain. For your now existing company, the sales and purchase contract is probably the most important one. Contracts for providing services, leasing a property or buying a Spanish company are also very common in Spain. Other commercial contracts can be about providing certain services/ products or buying a company.

Drafting contracts

When dealing in the Spanish local market it is important that contracts are drafted in Spanish and checked carefully by a legal professional with experience in dealing with such business matters before they are finally signed.

At SpainDesk, we can prepare all types of commercial contracts and conditions for your Spanish company. We provide accurate advice that will protect your interests while maximising the benefits from the agreement throughout its period.

We have a wide range of services related to legal aspects in business matters, such as property transactions or employment law issues. Our team is always available to provide you with accurate advice and guidance to protect your interests in business matters, including commercial contracts. We will make sure that you are aware of the legal requirements of terms and conditions as well as any new clauses required by law.

Signing contracts

When you are not an expert, always seek legal advice before signing commercial contracts. It is important to have a Spanish legal professional review the contracts and conditions before they are signed. While it may seem like an unnecessary step, having someone look over your contract terms will help ensure that you do not miss any potential issues that could cause problems for both yourself as well as the other contracting party in future.

Next to this, we can also represent your company and sign contracts through the Power of Attorney. If you are the manager of a company in Spain but cannot sign contracts, we can help. The Power of Attorney is an important document that allows someone to perform certain acts on your behalf. Contact us today for more information about our services and benefits.

Commercial contracts in Spain

Payroll administration and management

When you want to have personnel working for you, you need a structured Spain payroll plan. You will have to make sure that everything is legally correct, and you meet the payroll requirements set by law. Payroll administration is defined by the Spanish government as a set of measures, processes and controls that the employer must ensure are followed with regards to salaries paid to employees.

As your company grows in Spain, you will be responsible for more people working for you than just yourself or other partners from time to time. Starting up a business is always challenging but having personnel on staff will certainly help.

Our payroll management in Spain will make sure your payroll-related activities are completed in a timely manner with as little disruption to business operations and resources as possible.

Spanish payroll administration services

Our lawyers, accounting, and recruitment experts are ready to assist you with the following services.

  • Salary payments.
  • Calculation of salaries and tax deductions.
  • Preparation of payslips, including those in English or Spanish language.
  • Creation of employment contracts.
  • Timesheet calculation and management for employees that are required to hand in timesheets at the end of every month or week depending on their contract terms.
  • Preparation, printing and mailing of reports.
  • Payment of employers’ Social Security contributions.

If you would like to know more about our payroll management and services, please do not hesitate to contact us today for a free consultation. We provide guidance on the most suitable solution that meets your needs based on your company.

You will get an optimised solution for payroll management that helps your business run smoothly.A fully automated solution will ensure compliance in your payroll administration as well as management throughout the year, even if numbers change or new regulations are introduced during the year.

Employees on payroll in Spain

Social security management

Social security is an important aspect for people that work in Spain. If you or your employees work in Spain, you will have to be registered at the Spanish social security authorities.

Social security contributions are paid every month and paid by the employer. So in the case you own a business, you will need to pay contributions for your employees via their payslip.

At SpainDesk, we can help our clients every step of the way with their business. These steps include the payroll and social security part. We will ensure that social security payments are correct and that you know all the rules and regulations related to labour law. We offer a wide range of services in social security management for both companies and individuals, such as:

  • Social Security registration in Spain
  • Preparing and submitting Social Security declarations
  • Calculating employers’ and employees’ Social Security rates to the corresponding Spanish Government Agencies.

SpainDesk will always keep you updated on the payments that should be made and prepare all necessary documentation for your employees’ social security, employers’ and personal contributions to Spanish authorities promptly matter.

You must register at the RETA as a freelancer and registered as an Autónomo. We can also help you with this registration and tell you which amount you need to pay.

Limited Liability Company in Spain

Do you want assistance with starting your business?

With most of the above points, we can assist you. If you need more details about starting a business in Spain, you can contact SpainDesk. Our experienced team has an excellent record for concluding business agreements and contracts for foreigners to start in Spain.

Frequently asked questions

How much does it cost to start a business in Spain?

Our company formation services in Spain cost 1.500 euros and upwards. It depends on the type of company and services you need. This price includes all legal costs, administrative fees and accounting services like VAT registration, bookkeeping accountancy or audit service within a year. Starting a business in Spain doesn’t have to be expensive with us. Contact us, and we will give a price that fits your unique situation.

Starting a business in Spain takes approximately three months if you do it as an individual. You will need to be physically present, deal with the notary yourself, and fill out various legal forms. Starting a business by yourself is not easy, especially if your legal Spanish language skills aren’t good enough.

What do I need to pay when starting a business in Spain?

When you start a business in Spain, some legal costs are involved. These include the cost of registering a company in Spain and setting up an office space. Getting electricity, water, and an internet connection can also be expensive. As with every country on our planet, you have to pay business taxes when you have a business.

Can foreigners start a business in Spain?

Foreigners can start a business in Spain, and non-residents can also own a business. Business registration for non-residents can be more challenging and lengthy.

How long does it take to start a business in Spain?

The whole process of starting a business from scratch usually takes around three months. Starting a business in Spain as an individual can take up to six weeks because it takes time for you to receive your company’s number, which is called NIF/CIF (Número de Identificación Fiscal). While depending on the circumstances, starting a business with us will take around a month, and we will assist you with the whole process.

Is it easy to start a business in Spain?

Starting a business in Spain is easy as long as you have the right support. When speaking about the limited liability company, starting the business on your own can be very complicated and time-consuming because there is much to do. The paperwork you have to fill in will be in Spanish, but we can assist you with the whole process. Starting a business with our team makes the whole process much easier for you because we take care of all the legal steps and paperwork.

Is Spain a good place to start a business?

Spain is an attractive place to start a company. Starting a business in Spain is not only easy but also relatively cheap. The Spanish market has been growing for the past years and it becomes more international every day. Popular business industries in Spain are energy, IT and tourism. You can also find many businesses in the food industry, the automotive industry, clothing industry and real estate industry.

Do I need a business visa to have a company in Spain?

No, you don’t need a visa when starting a business in Spain. Yet, starting your own company is a way for foreigners to live and work legally in Spain. In any case, if you stay longer than three months in Spain, you need a visa. You can get a business visa within two weeks, and we will assist you with all of the administrative steps that have to be done correctly before opening your bank account.

As a foreign company, do I need to pay income tax?

Starting a company in Spain means paying taxes on profits if you are generating income from the Spanish market. When you are a foreign citizen and profit, you will also need to pay income tax.

What type of taxes do I need to pay when starting a business in Spain?

When registering a company, companies usually hire an accountant in Spain who will assist them during their first months (or years) of operation by preparing the monthly accounting reports required by law. Once your new company has been formed it’s automatically registered with tax authorities. You will then need to file your taxes and forms (Modelo’s). The type of taxes and forms you need to file depends on the type of business and your activities.

Business in Spain

Do I need legal assistance when starting a company?

When starting a company it’s always recommended to get legal assistance. Starting a business in Spain can be done as an individual, but this requires understanding the process, which includes Spanish paperwork and legal documents. It requires a significant amount of due diligence on your part. It’s normal (for Spanish citizens) to get help with starting a business, so it is highly recommended for a foreigner.

It’s always recommended to get assistance when starting a company, especially when making a foreign investment. Next to helping with the company incorporation, it is also smart to get an accountant and bookkeeper involved and let them guide you in dealing with the Spanish Tax Office, or your local tax authority.

What are the benefits of the Spanish Limited Liability Company?

The Spanish limited liability company has the following main benefits:

  • Limited Liability: Shareholders only can lose their investment
  • Foreign Investors: Foreign investments can own 100% of the company
  • One shareholder: The minimum of shareholders is one
  • Low capital investment: The minimum share capital is 3.000 euros
  • Flexible Management: The minimum number of administrators is one

What are the benefits of the Spanish Sole trader (Autonomo)?

The Spanish sole trader has the following main benefits:

  • Low capital investment: The minimum share capital is 0 euros.
  • Flexible Management: There is no minimum number of administrators. You only have to hire a bookkeeper who prepares your accounting reports at least once per year and sometimes an accountant/lawyer for advice on taxes and legal affairs.
  • Deductibles on profit: You can deduct the costs of normal business activities such as telephone bills, office equipment, and supplies.
  • Easy to set up: Starting a sole trader business in Spain is easy and quick, you can do it with a minimum of documentation.
  • Social security coverage: Starting a business in Spain as a sole trader entitles you to social security coverage.

Where can I find my local tax office in Spain?

Tax administration in Spain is decentralised, and you can contact your local tax office for any questions or concerns. Regional tax offices in Spain are responsible for different aspects of taxation, such as SUMA offices in Alicante or ATC offices in Catalonia.

Do I need a business plan when starting a business in Spain?

It is not a legal requirement to register a company in Spain. However, starting a company without anything written down can result in a confusing situation and problems if something doesn’t go as expected.


Starting a business in Spain can be great. Spain has an interesting local market and expanding international business culture. The main business structure, the Limited Liability Company (SL) offers many benefits. These include that it can be run by any number of shareholders (including foreigners), with only one administrator, who must have less than 3.000 euros invested. Being a freelancer in Spain also has its perks: you’re not required to invest capital upfront or hire administrators; just make sure you get advice from lawyers and accountants when dealing with taxes and legal affairs.

At SpainDesk, we can help you for a fair price as your business advisors, business lawyers, bookkeepers and accountants in Spain. While we have explained a lot in this guide, we do recommend you waste any time and money figuring everything out yourself. We would love to help you get your company registered and provide you with all the necessary advice to run a successful business in Spain.

Disclaimer: Information on this page may be incomplete or outdated. Under no circumstances should the information listed be considered professional legal advice. We highly recommend seeking guidance from a legal expert if you lack extensive knowledge or experience dealing with any of the procedures outlined in these articles.

SpainDesk makes your company formation easy, fast, and worry-free

This article will look at how Spain’s payroll system works, including the employment laws, registration of employees and paying taxes. Interesting for people that are thinking about starting a company in Spain, putting people on payroll in Spain, or learning more about payroll administration in Spain.

Spain welcomes foreign investment, especially payroll investments in Spain. National and local authorities are always looking to stimulate the Spanish economy. Next to this, because of the high unemployment rate and the cheap cost of living, being present in Spain as a foreign business is also very attractive.

Employment law in Spain

There is high regulation on employment law in Spain. The Labor Standard Act/Employment Act in Spain is strict, and the government inspects regularly. Therefore, as a business operating in Spain, it’s essential to follow proper employment laws and procedures when you hire or fire employees.

Collective bargaining agreements

Sometimes employment contracts are created with collective bargaining agreements known as the ‘Convenio Colectivo’. These compacts set standards for labour conditions such as minimum pay, maximum working hours, and paid holidays, which significantly influenced Spain’s payroll structure.

Collective Company Agreements are made at the company level or national industry levels by the trade unions and employers’ associations. These agreements are legally binding for all companies that have made these agreements.

Often, the labour unions make groups according to the professional group or profession or their corresponding contributions.

Minimum wage

The government sets the country’s minimum wage. Employee’s salary has risen considerably in recent years, reaching €1108 per month (approximately £990, $1250) as of 2020.

Severance pay

Dismissed personnel have an entitlement of 20 days of compensation for each year worked, up to a maximum of 12 monthly payments. This right to severance pay also applies if an employee does not consent to a substantial change in their employment contract or a long-term relocation of their job site.

Payroll in spain

Work hours

Regular working hours in Spain are from 9:00 to 17:30, and workers have entitlement to a break of at least 30 minutes during the day. Workers in Spain are permitted to work a maximum of 80 hours of overtime per year, but in certain industries and situations, there are exceptions to this rule.


Employees are entitled to off time on their national holiday. There are ten national holidays in Spain each year and other local holidays that different parts of Spain recognize. A full-time employee gets 22 days of paid vacation time each year, which equals 30 calendar days. They can take it all at once or split it up however they choose by Spain’s labour laws, but at least one vacation period must be two weeks long.

Maternity leave and Paternity leave

Men and women have entitlement to paid leave of 16 weeks when there is a newborn. For twins, the term rises to 18 weeks; it is 20 weeks for triples. There is also an additional two-week period for children with disabilities.

Sick leave in Spain

Standard sick leave in Spain: 1-3 days (3 days) without pay unless the employer agrees to cover, 4-20 days at 60% of the employee contributions base paid by the employer, 21 days or more at 75% paid by Social Security.

Sick leave effective March 11, 2020, the Spanish government has approved an urgent Royal Decree that deems these leaves to be incurred by the state from the first day of absence (75% of the base) so employers will not have to cover them at their expense or not entirely.

Payroll in Spain

Taxation and Spanish Payroll

Taxation rates may vary significantly across regions. In this regard, payroll departments must understand applicable regulations. If you are a foreign company, you should get familiar with the primary taxes in Spain which include: income tax, social security contributions, VAT, and corporate tax.

Taxes in Spain differ across the 17 different regions. Making sure your company’s payroll and HR remains compliant can be a daunting process for local and foreign companies.

Payroll and social security contributions

Tax laws in Spain require employers to withhold tax and social security contributions from employee wages.

Businesses must register every employee’s contract with the social security authorities and the national employment service. They must register workers with the Public Employment Service within ten days after the employee’s commencement date.

The precise taxes primarily depend on taxable monthly payments, and both Spanish employees and employers are required to pay social security contributions. Employers and employees split the tax burden of social security contributions. The employee contribution rate is 6,35 to 6,40 per cent of gross salary, whereas the employer payments are about 31 to 33 per cent of this amount. The funds are channelled into the public insurance system and used for various reasons, including illness, accident, maternity, retirement, and unemployment.

Employee income tax

Employee income tax is progressive in Spain, with rates ranging from 19% to 45%. How much income tax the employee needs to pay depends on yearly earnings and the autonomous region where the taxpayer resides. For instance, the employee income tax rate for people residing in Andalucia is lower than in Madrid.

The following are the current employment income withholding tax brackets:

  • 19%: €0 – €12,450
  • 24%: €12,450 – €20,200
  • 30%: €20,200 – €35,200
  • 37%: €35,200 – €60,000
  • 45%: over €60,000

Employers are responsible for collecting and withholding income tax on behalf of their workers. They must make the payments for the withheld amounts to the treasury by the 20th. Income tax applies to all types of incomes paid in salary, real property, cash on hand, and financial assets. Employers must also complete Form 111, which is titled ‘IRPF Withholdings at Source,’ and submit it to the Ministry of Finance.

Income tax declaration by employees

As previously discussed, when you have employees in Spain, you have a legal obligation to withhold taxable income payable to their employees. The necessary withholdings estimate the final tax due based on the previous final declaration. Companies must pay tax authorities on a monthly or quarterly basis.

Employees must finalise their income declaration in the period after the end of the year and have to pay or receive the difference. The deadline to file your tax return for the previous year is the 30th of June of the next year.

Non-resident employees

In the case of hiring non-residents in Spain, there will be a flat tax rate on income earned. When an employee is not 183 per year in Spain, he is considered a non-resident and will pay a different income tax.

In general, the withholding rate for non-residents is set at 24 percent. However, if you are from the EU or EAA, the withholding tax that applies is 19 per cent.

Payroll in Spain

Registering your business for payroll

There are two ways to register your employees for payroll. You can form a Spanish company and join the Social Security system to administer payroll for workers or register your already foreign company with the social security office. If you would like help with your payroll and registering your business, you can contact us for payroll services.

When you are a foreigner and want to register employees on a company in Spain. The basic steps to get there are:

1. Get yourself an individual Tax ID number

As a foreigner, you will need a NIE number this number. This number is necessary to open bank accounts, work, and start companies in Spain.

2. Get a Fiscal identification number for the company

Your company will need a NIF number. This functions as the VAT number for the company.

3. Register the company on the local Chamber of Commerce (Registro Mercantil)

When forming the company you will need to sign deeds of incorporation, and bylaws at a notary.

4. Register the company for corporate and income tax

The next step is to register the company with the tax office. With this, you will be obligated to pay the required taxes for your business activities.

5. Obtain authorisation to hire employees

Authorisation by the government to hire employees is needed. Your company needs to pass the requirements to have employees, and therefore the government will do a check.

6. Register employees with the social security office

After you have passed the check, you will be able to fill out a form online to register employees with the Social Security office, and put them on the payroll in Spain.

Workers in the country

Payroll Services in Spain

At SpainDesk, we will help you navigate the taxes in Spain. Our qualified team closely engages with clients to ensure compliance and deliver pay accurately and on time. We manage all aspects of payroll, including benefits, withholdings, and social security payments. Our payroll outsourcing services are ideal to ensure full employment and payroll compliance.

Payroll services we offer are:

  • Spanish Employment Contracts
  • Handling of salary payment
  • Payroll Processing
  • Handling of social security contribution
  • Tax declarations and administration
  • Tax and Labour Law

Expert access

As a business owner or manager, you want to hire a payroll provider with in-depth insight into payroll laws and regulations, including complex payroll tax issues. With us, we will give you this. We know how the Spanish labour law works, and our services are especially essential for companies working in multiple jurisdictions.

Prioritize your core business

Payroll doesn’t have to be a core function of your business in Spain. In this regard, we help business owners devote more time and resources to focus on revenue-generating activities. SpainDesk effectively takes control of your payroll processing, and thus you can focus more on your core business, especially customer service, sales, and marketing.

Regulatory compliance

Complying with laws and regulations isn’t an option for businesses, especially when foreign governments are involved. As a business owner or manager, you want to avoid running afoul of the law since it can be very costly regardless of the size of your business. At SpainDesk, we ensure your company is continually on top of all relevant labour, tax, immigration, and business laws.

It’s worth mentioning that legal and compliance requirements about payroll can be very complex and daunting, especially when operating internationally. By outsourcing payroll to SpainDesk, you assure that payroll tasks are handled effectively by a qualified team knowledgeable about local, regional, and national laws and regulations.

SpainDesk takes pride in helping businesses in Spain avoid penalties and unnecessary audits triggered by non-compliance. We are continually keeping up with changing payroll laws in Spain.

Contact SpainDesk

Stay compliant when it comes to payroll and human resource-related services in Spain. We will ensure your Spanish expansion is seamless and hassle-free if you are a foreign entity. Contact us to learn more about our services or get bespoke quotations for your business. SpainDesk offers competitive prices, so you don’t have to break the bank!

Payroll Spain

Frequently asked questions

Below you can find some frequently asked questions around payroll in Spain.

How is the management of payroll tax in Spain?

When working in Spain, the payroll tax splits between the employer and the employee. However, the employer holds a certain percentage for these taxes on the salary of its employees. The payroll tax works on a progressive rate (depending on your income level).

What is the payroll tax in Spain?

As with most countries, the Spanish payroll tax comprises several elements that pay for workers and government benefits. There’s a standard deduction on your annual salary form, and others deductions for pension insurance and health insurance, amongst other things.

When is the payment of salaries in Spain?

In general, salary payments are every month. However, it can also be weekly or biweekly, depending on the employment contract. It is best to state the payment date on the employment contract.

How do I employ international people someone in Spain?

First, they need to get a NIE number. After this, you need to fill out a registration form with the Labor Office. The third step is registering the employees with the Social Security system. It’s vital for companies hiring foreign nationals to know how to deal with payroll tax in Spain. If you would like us to help you. Contact us and we will send you a quote.

Do I need to register my company in Spain to have employees in Spain?

No, you can also hire employees in Spain by registering your foreign business with the social security office. We can assist you with this.

What is the CCC number in Spain?

The code is a numerical combination of eleven digits that is assigned to each business in order to make social security payments. The General Social Security Treasury (TGSS) uses this code to identify employers.

What is the NIE number?

The NIE number is the Spanish Tax Identification Number for foreigners. If you’re planning to start a business in Spain, you need it.

Payroll in Spain

Do you have to declare taxes at the end of the year as an employee?

Yes, the name is of the annual declaration of income for employees ‘Declaración de Renta’.

Can I put someone on the payroll in Spain without registering them as an employee?

No, however, if the person you want to recruit in Spain starts working as a self-employed (Autonomo). You can hire them without the need for social security contributions, payroll tax withholding, and contracts. However, they will have to pay social security contributions themselves, and other Autonomo Taxes.

Do I need a NIF if I want to hire employees in Spain?

If your company has economic activities in Spain, you need a NIF number to declare taxes. The NIF number (Número de Identificação Fiscal) for limited companies functions is the VAT Number in Spain. The document provides identification to tax authorities. The number consists of a letter and eight digits. Previously the NIF number was called the CIF number.

What is the SEPE?

The SEPE is the Spanish National Public Employment Service. It is a policy package that includes structures, measures, and actions to advance employment in the entire state.

When a work accident has happened do I need to report it?

Yes, when you have someone on the payroll in Spain and a work injury happen, you must complete paperwork regarding the work injury through an online process known as the Sistema Delt@.

How do I communicate social security documents to the General Treasury of Social Security in Spain?

The RED Direct transmission mode handles the communication. Through this system, companies are required to fulfil their Social Security obligations.

Partner in payroll in spain

A word from SpainDesk

Payroll in Spain is a tough field without the aid of an expert. It is recommended for foreign businesses with someone on the payroll in Spain to seek professional advice. We help foreign businesses based in Spain to solve their payroll challenges. We offer a complete service from company formation and tax declarations to recruitment. If you are looking for information about payroll in Spain or payroll services then contact us today to find out how we can help.

Disclaimer: Information on this page may be incomplete or outdated. Under no circumstances should the information listed be considered professional legal advice. We highly recommend seeking guidance from a legal expert if you lack extensive knowledge or experience dealing with any of the procedures outlined in these articles.

Spain is a great place to start a business. The country has a rich culture and history, and it is home to some of the world’s largest companies. There are many different businesses you can start in Spain, and each one has its own unique set of challenges and opportunities.

Popular businesses

The most popular businesses in Spain are tourism-related businesses. Spain is a popular tourist destination, thanks to its sunny weather, stunning architecture, delicious food, and friendly people. There are also many opportunities in the Spanish market for retail businesses, technology companies, and manufacturing firms.

1) Restaurants

Spain is a great place to start a restaurant business. The country has a rich culture and history, and it is home to some of the world’s most renowned chefs. There are also many different types of restaurants you can start in Spain, and each one has its own unique set of challenges and opportunities.

Why it can be profitable

Starting a restaurant in Spain can be very profitable for several reasons. First, the country is a popular tourist destination, and restaurants are always in high demand. Second, the Spanish market is growing rapidly, and there are many opportunities for new businesses to succeed. Finally, the cost of doing business in Spain is relatively low compared to other countries in Europe.

Tourism business in Spain

2) Bars and nightclubs

Spain is a great place to start a bar or nightclub. Like restaurants, bars and nightclubs are in high demand in Spain because it is a popular tourist destination. Also, restaurants, bars, and nightclubs have a lot of competition in the Spanish market. Although there are many opportunities for success, you will need to offer something unique to stand out from your competitors.

Why it can be profitable

Bars can make a lot of money because they offer a unique service that people are willing to pay for. They provide a place where people can relax and socialize with friends, which is something that most people enjoy. Additionally, bars are relatively cheap to operate, so they are able to keep their prices low while still making a profit. Finally, the Spanish market for bars is growing rapidly, so there are many opportunities for new businesses to succeed.

3) Online businesses

The most popular type of online business in Spain is the e-commerce business. There are many opportunities in the Spanish market for businesses that sell products and services online. Additionally, there are many Spanish companies that are looking to expand into the online market, so there is a lot of potential for growth.

Why it can be profitable

There are many ways to make money with online businesses. One way is to sell products and services online. This can be done through e-commerce websites or through social media platforms. Additionally, many Spanish companies are looking to expand into the online market, so there is a lot of potential for growth in this area. Another way to make money with an online business is to sell ads on your website. This can be done by placing ads on websites, or it can be done through other means like search engine optimization (SEO). Selling ads directly from a website is very profitable and can bring in a lot of revenue.

Hotel business in Spain

4) Hotels

There are many reasons people might want to start a hotel business. Perhaps they are passionate about travel and want to help other people experience the world. Maybe they have extensive experience in the hospitality industry and want to use their knowledge to start their own business. Or, it could be that they simply see the potential for success in the hotel market and want to capitalize on it.

Why it can be profitable

Starting a hotel is an excellent business opportunity in Spain because there is a high demand for hotels. It’s estimated that the tourism industry generates nearly twelve percent of the country’s gross domestic product (GDP), and around 12 million people visit Spain every year. That means more than ten million overnight stays per year, generating approximately €20 billion annually.

5) Tourist attractions

People might want to start a tourist attraction because they are passionate about travel and want to help other people experience the world. Perhaps they have extensive experience in the hospitality industry and want to use their knowledge to start their own business. Or, it could be that they simply see the potential for success in this market and want to capitalize on it.

Why it can be profitable

Another reason people might want to start a tourist attraction is that there are many opportunities in the Spanish market. Spain has thousands of attractions, whether they are natural or man-made. They range from cultural and historical sites to outdoor activities. Because of this, there is a huge market for tourism in Spain.

6) Clothing stores

Spain has a lively fashion industry, with many fashion designers coming up with new designs every year. There are many Spanish fashion magazines, and people are very fashionable in general. This makes the clothing market attractive for big and small businesses. Brands like Zara and Desigual have done very well in Spain, and that is because people like to shop here.

Why it can be profitable

There are many reasons people might want to open a clothing store in Spain. One reason is that there is a large market for fashion in Spain, especially among young people. Another reason is that this type of business gives the entrepreneur the ability to connect with customers directly and get instant feedback about their products or services

7) Electronics stores

There are many reasons people might want to open an electronics store in Spain. For one, the market for technology is growing rapidly. People love their smartphones and tablets, so if you own a business that provides these types of products, there will always be customers coming through your doors. Furthermore, if you can differentiate your product or service somehow, you will have a large advantage over your competition.

Why it can be profitable

Electronic devices are always in demand, and even more so in Spain where people are very technologically savvy. Competition is not too high for this type of business, especially if you sell products or services that your competitors do not provide yet. Succesful electronic stores in Spain include Carrefour and Media Markt.

8) Furniture stores

People might want to open a furniture store because they see potential in the Spanish market. Furthermore, there is an increasing demand for quality furniture, both locally and internationally. Furniture stores are especially popular around Christmas time, as people decorate their houses with new items. The margins on this business are high, which

Why it can be profitable

Furniture in Spain is very attractive and unique. People like to combine modern styles with pieces that are rich in history and tradition. This makes the furniture industry one of the most profitable industries, as the margins can be very high. Furniture can be seen as art, and people are willing to pay for it.

9) Car dealerships

Spain has its own car industry, and that is a good reason people might want to open up a car dealership. Furthermore, if you sell exclusive brands, your store will be highly profitable as the demand for those products will be high. People love their cars, so it’s a good idea to open up a car dealership if you want to capitalize on this strong passion.

Why it can be profitable

Car businesses in Spain might be profitable because people love their cars, and there is a large market for second-hand cars as well. Many affluent families have at least one luxury car, but the middle class also drives expensive models from German automakers. Owning a car dealership can therefore bring in considerable revenue.

10) Bike shops

Bikes are very popular in Spain, where the weather is good for biking most of the year. People use their bikes to commute to work or school, and they are also used recreationally. Owning a bike shop in Spain is ideal for someone who loves bikes, and someone who wants to make money out of their passion.

Why it can be profitable

Good bikes are expensive, and people are willing to pay for them. Furthermore, if you can provide your customers with specialized services (like repairs) the business will be profitable even without many sales.

11) Real estate and property rental

Starting a property business is a great business opportunity. Although the real estate market is not at its highest, you can still make a lot of money off this business provided that you have some capital and knowledge of what you do. There are many undeveloped pieces of land in Spain, so if you have some capital you can buy these pieces of land cheaply and develop them yourself. The process is can be complicated so whenever you are ready to buy contact a property lawyer who can guide you through the legal procedures.

Why is it profitable?

The best part about this business is that since it’s an industry where people are constantly buying and selling, there will always be demand for this kind of service. You can lease properties then renovate them and resell them for profit. You can also become partners with other real estate agency owners and lease properties for them, split the profit.

12) Agricultural business

If you have some land that you do not use, then this is a good business opportunity. You can plant any crop, or raise animals such as cattle and goats that will sell to the market at a later time. An agricultural business is great for retiring, living, and working abroad, as the land is usually cheaper and you don’t need to work all year round. Popular agricultural products from Spain are olive oil, wine, almonds, and oranges.

Why is it profitable?

An agricultural business in Spain might not seem like the most profitable business, but because demand for produce in Spain is high and it’s usually priced higher than its worth, you can still make a profit.

13) Financial services

Financial services in Spain usually include insurance, trading, currencies, and banking. You can set up a financial services business in Spain with some capital, but be aware that the market is very competitive by nature so it’s not easy to stand out from everyone else.

Why is it profitable?

Although most people just prefer to use banks for their finances, there is still a big market for those who prefer to do it themselves. That’s where financial services businesses come in, so if you have experience or knowledge about these types of business then this might be a good opportunity for you.

14) Healthcare services

Spain’s healthcare system is generally public, so the government tries to keep costs cheap for everyone. As a result, it’s difficult to set up a business whose main source of revenue is healthcare.

Why is it profitable?

If you’re capable of establishing connections with different private clinics and hospitals in Spain then you can start your own health care business without having to rely on the public system.

15) Transport and logistics industry.

Spain is a big country and there’s a lot of transportation going on every day. There are several markets for this type of business such as industry, business to consumer, and business to business. You can invest in vehicles or your own logistics company.

Why is it profitable?

Transport and logistics are always needed, as the demand for this type of service is never-ending. If you can afford your own logistics company and can keep the costs low, then you’re in for a good profit.

Business in Spain

Understanding the business culture in Spain

Before starting any business in Spain, it’s important to understand the unique cultural and economic landscape of this fascinating country. Doing business in Spain, for example, is very different from doing business in the United States. Characteristics of Business in Spain are generally more relaxed, and Spanish workers tend to expect a higher degree of independence. In the U.S., for example, it’s common practice for employees to punch a time clock before and after their shifts. In Spain, however, most people work from 9:00 am – 2:00 pm with an hour for lunch in between. Because of this, Spanish workers tend to stay later at the office than their American counterparts.

Business dress in Spain is also different from that of other countries. Most men wear business suits with ties, and women typically wear blazers over skirts or dresses. However, most people working in service-related careers, such as hotels and restaurants, do not dress formally.

Doing business in Spanish

Starting a business in Spain is similar to starting one anywhere else. You will need to do some market research, get licenses and permits, set up your office space, hire employees, etc. However, there are some important differences you should be aware of when starting a business in Spain:

Tax laws in Spain are very complex, and they can vary greatly depending on the size of your business. Researching tax law before starting your business is crucial to ensuring that you don’t end up spending too much or too little.

Office space and personnel are cheaper in Spain than in other western European countries, but the employees may expect a higher degree of independence since workers in Spain tend to be more relaxed.

Finally, the majority of people in Spain speak Spanish. That means that if you want to do business in Spanish then hiring employees who speak both English and Spanish will give you access to a wider market.

Also, remember that if you’re planning to hire employees then having a solid contract, payroll administration, and understanding of Spanish payroll laws is very important in Spain.

Companies in Spain

A word from SpainDesk

The most popular type of business in Spain are those that have to do with services. However, you can find good profits in several other industries as well, especially if you’re willing to deal with some unique challenges associated with doing business in Spain. If you are ready to start your business in Spain, then we can help you with the company formation process.

Already have an existing company? Then we can help you with any of your accounting, payroll, and/or bookkeeping needs! Feel free to contact us for more information. We also have a quick guide to starting a business in Spain that might be useful if you’re familiar with the process already.

Spain is a great place to start a small business, and the country has been ranked as one of the most entrepreneurial in Europe. There are many freelancers in Spain, and many small businesses are started every year in Spain.

What is an Autónomo?

An Autónomo in Spain is someone who works for themselves in Spain. In other words, an Autónomo is a sole proprietor in Spain. This means that they do not have a contract of employment. Instead, the Autónomo is their own boss and is responsible for setting their own hours and making their own profits. While an Autónomo does business independently, it is not the same as the Spanish limited liability company called SL. The main difference is that the Autónomo is responsible for their company’s debts.

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Self employed workers

What is needed to become an Autónomo?

Depending on your circumstances, you will need certain documents to become an Autónomo. Below we give an overview of the most common situations.

Spanish Citizens

As a Spanish citizen, you will need the following:

  • NIF number
  • Registration with the tax office
  • Registration with the social security office

E.U. Citizens

As an E.U. citizen, you will need the following.

  • NIE number
  • Registration with the tax office
  • Registration with the social security office

Non-EU Citizens

If you come from outside the EEA/Switzerland, you will need the following:

  • NIE number or TIE card
  • Registration with the tax office
  • Registration with the social security office

Registering as an Autonomo in Spain

How to register with the tax office as an Autónomo?

Every Autónomo must pay Autonomo tax, and they need to register with the Spanish tax office Agencia Tributaria. The tax office is also called the Hacienda and AEAT.

It is required to register the economic activity you will perform as an Autónomo. So that they can charge you with the Economic Activities Tax (Impuesto de Actividades Económicas IAE.

To get registered, one of the things you will need to do is fill in a Spanish tax form (Modelo 037 or Modelo 036). These forms are available at the tax office. You can also register at the tax office by going to the local tax office and requesting the forms.

Completing these Modelo’s will legally confirm that you will have to pay the tax that is required by your economic activity. There could also be other modelo’s involved with your Autonomo registration, e.g. when you are importing alcohol.

Autónomo’s pay tax through their personal income tax in Spain. The amount of tax you will have to pay, as an Autónomo, will depend on the amount of money you make. The personal income tax is a progressive tax, which means that the more money you make, the higher percentage of tax you will have to pay.

If you are not registered for personal income tax in Spain, you must fill in Modelo 030. This form will obligate you to pay personal income tax in Spain.

Annual income tax payments

When you are self-employed in Spain, you will have to do income tax returns. The amount of tax you have to pay as an Autónomo in Spain depends on whether you are considered a tax resident or tax non-resident.

Furthermore, tax rates in Spain differ depending on the province, so the fees vary across the country. According to income earned, residents of Spain are taxed at a rate ranging from 19 to 47 per cent.

The IRNR, or Impuesto Sobre la Renta de No Residentes in Spanish, is the income tax paid by non-residents for tax purposes.

From April until the end of June, all tax residents, including Autónomos, in Spain must file a tax return for the previous year. The tax return is known as the declaración de la renta.

VAT tax

When you’re an Autónomo, you must pay VAT tax in Spain, just like when you run a business. In Spain, the vat tax is known as IVA. The VAT rate is 21 per cent. The rates for certain goods or services are 10% and 4%. Even if freelancers provide services outside of Spain, the VAT applies to all their work.

Freelancers are required to submit a quarterly tax return and pay any outstanding amounts. The quarterly VAT return, known as Modelo 303, is used for this purpose. You must still submit it even if you have nothing to declare.

Tax returns for autonomo's

How does the social security contributions work?

As an Autónomo, you are obligated to pay for social security contributions. The contributions you pay as a self-employed in Spain will give you access to this system.

The social security system in Spain

The public system in Spain is excellent, and it is one of the most developed systems in Europe. The plan covers a wide range of costs, including illness, retirement, maternity, paternity, work accidents, and unemployment.

Cost of social security as an Autonomo in Spain

The minimum quota for 2021 has increased to 67 and 289 euros per month. At the same time, the maximum fee has reached 998 and 1,245 euros per month in 2021. The range comes from discounts in the first months of starting as an Autónomo.

The more you pay, the more you receive when you retire or if you fall ill. A person who is sick at work and pays the minimum amount would get 18 and 23 euros per day. If he paid the maximum contribution, he gets between 80 and 100 euros.

Autonomo social security payments

Social security payments for Autónomo’s are made on a monthly basis. The social security office will send you an invoice for the social security contributions you have to pay. You can also find this information online on the website of Social Security Treasury. If you work with an accountant in Spain, they will help you with the monthly payments.

How to register with the social security office?

To be eligible to enrol in the Autonomo social security system (RETA), you must have a social security number. If you don’t have your Social Security number in Spain, you are obligated to get one. As an Autónomo, you will have to sign up at the General Treasury of the Social Security. You must register at sede.seg-social as a person that is an owner of an Autónomo. Registration is done through the Special Regime for Self-Employed Workers. Next to this, the company must register at the social security office with the associated Economic Activity of the company, in order to affiliate itself with the registered person.

Social security is tax-deductible

Any RETA payments are tax-deductible. This means that you can deduct any social security payments you have to pay from your Autónomo tax. So if you make any money, you can easily nullify any social security payments.

tax returns for self employed

Frequently asked questions about freelancing in Spain

Below you can find some of the most Frequently Asked Questions when it comes to freelancing in Spain

Can I work for a Spanish company as a freelancer from another company?

Yes, you can. You can work for a Spanish company as a freelancer from another company. However, if you pass a threshold of income, you will have to pay taxes in Spain as well.

Do I need an accountant?

It is recommended that you have an accountant to help with your taxes and social security payments. However, it is not obligatory. Our team of accountants is ready to assist you if you choose. Learn more about our accountant services in Spain.

Do I need to pay social security if I receive no income?

Yes, you will have to pay social security, even if you receive no income. However, you can stop your Autonomo registration when you have no income. If this happens, you don’t have to keep paying your social security.

Can you help me with registering as an Autonomo?

Yes, we can help you with registering as an Autonomo. We have a full company formation service that can help you with everything from setting up your Autonomo to getting your social security and tax numbers.

Do I need a bank account?

While you don’t need a bank account, you will benefit from having one. It is recommended that you have a bank account to receive any money that might come your way. When you are using an accountant, a separate bank accountant is also recommended, as you will need to keep your accounts separated.

How strict is the agencia tributaria?

The Spanish tax authority is strict when it comes to paying your taxes. Make sure that you pay them on time and always keep receipts to prove any transactions.

When is it wise to create a limited liability company?

If you require any borrowing for your business, creating a limited liability company is wise. Also, around the threshold of 60.000 euros, the company is cheaper to operate than the self-employed company in Spain because of taxes.

The most common Spanish limited company is the Sociedad Limitada or S.L., the minimum shareholder requirement is 3.000 euros.

Setting up a limited liability company is more complex than Autónomo in Spain. It includes bylaws, different company registries, and a notary. When you have a limited liability company in Spain, you will also have more obligations.

We can take care of these for you, so you can run your business without any worries. Contact us for a quote on these services.

How to become an autónomo workers and be self-employed in Spain

Do I get a certificate when I become an Autónomo?

Yes, you will get a certificate from the government when you become an Autónomo. This certificate is proof that you are self-employed, and it is essential to keep it safe as you will need it when you file your taxes.

What are the benefits of being an Autónomo?

There are many reasons why you might be considering starting your own business in this country, but before we get into those, here’s some information about what it takes to start a company in Spain. A summed up list is as follows:

  • Being your own boss
  • Flexibility with your time
  • Work from home
  • Work for multiple companies at the same time
  • The social security system in Spain is very good

Can I also get private health insurance instead of the social security regime?

No, you cannot. If you are Autónomo in Spain, you will need to pay into the social security regime. You can still have private health insurance if you prefer this, but you will need to pay into the RETA of Spain.

Is the registration process difficult for Autonomo’s?

Company formation professionals often do the registration process for Autonomo’s in Spain because the process is complicated and tedious. The process includes filling several Spanish documents and an appointment for identification numbers and registrations at the social security and tax offices.

If you are unfamiliar with Spanish, it is faster, recommended, and easier to use a company formation service since they will ensure that all documents are filled correct.

What are the most common small business jobs in Spain?

Popular jobs that the self-employed in Spain have are marketing and communication, design, web development, writing and translation, personal assistant, business consultant. But you can also find bar owners, gastronomy owners, commercial agents and other professions.

Autonomo in Spain

A word from SpainDesk

We hope you enjoyed reading about the basics of being an Autónomo in Spain. Being self-employed or running a business is not easy to do alone. Our Autonomo registration services in Spain will help you get all of the paperwork and registrations done quickly and correctly so that you can focus on your business. We also offer other services such as property purchase guidance, personal tax advice/returns, and corporate law advice. With this, we hope to improve your stay in Spain. If you are interested in our services, don’t hesitate to get in touch with us, and one of our consultants will get back to you shortly.

Disclaimer: Information on this page may be incomplete or outdated. Under no circumstances should the information listed be considered professional legal advice. We highly recommend seeking guidance from a legal expert if you lack extensive knowledge or experience dealing with any of the procedures outlined in these articles.

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The VAT number in Spain is an essential part of doing successful business within the Spanish Market. The Spanish market is the 5th biggest market in the European Union, and this makes for great opportunities for foreigners to get in on the action. This article will talk about the different aspects of the VAT number in Spain, the number you will get when you form a company in Spain. Topics that we will discuss are VAT registration, the Spanish tax system, NIF number, VAT purposes, VAT return, and the purposes of the Spanish VAT.

What is a VAT identification number?

In business, the VAT identification number is a one-of-a-kind identifier for sole proprietors, partnerships, and limited liability companies. If the Tax and Customs Administration considers you an entrepreneur for VAT purposes, they will need you to have this number.

The VAT identification number is a taxpayer reference code, and all kinds of organisations and clients can ask for it. You also use your VAT ID number when interacting with consumers, such as on invoices and websites. In a nutshell, you communicate this to your company’s external communications.

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How is VAT registration done in Spain?

The Spanish Tax System assigns each business that is incorporated a NIF number (número de identificación fiscal). This will be your company’s identification number. When you are about to get started with your business in Spain, you must get your NIF number.

To get this number you must register with your (local) branch of the Administración de la Agencia Estatál de Administración Tributaria (AEAT). The Spanish Tax Administration will assign you a NIF number after checking that your business is registered, has an address, deeds of incorporation, bylaws, and a variety of other formalities. It is recommended a Spanish lawyer handles your incorporation so you are compliant with all necessary corporate laws. Don’t hesitate to contact us if you want us to help you with the company incorporation.

Spanish VAT number

What is the Format of the Spanish VAT number?

In Spain, the VAT identification number is known as “Número de Identificación Fiscal” (short form: NIF) and is required for EU commercial exchange. The Spanish VAT number was formerly known as the CIF number (Código de Identificación Fiscal). It is very common (and normalised) to refer to a business number in Spain as a CIF number.

Spanish VAT number is formatted as:

ES + Letter + 8 digits or ES + Letter + 7 digits + Letter

So what does it stand for:

  • ES = country code
  • Letter = type of entity (e.g. B for Sociedad Limitada)
  • First two digits: stand for province company was registered
  • Last five digits: random digits
  • Last character (digit or number): control character
  • Example: ESX12345678

When do you need a VAT number in Spain

In general, all firms and legal entities in Spain must be registered with the Spanish Commercial Registry and carry a Spanish VAT. The main reason for Spanish VAT registrations are:

  • If you store goods in Spain, you must have a Spanish VAT number. This is true even if you are not making any sales and therefore never charging customers or clients for services rendered.
  • If you are a foreign seller that imports more than 35.000 in sales, you must register for a Spanish VAT number.
  • If your company operates within Spain, you must register for a Spanish VAT number even if the turnover does not meet the level of the threshold mentioned.

Is one of these scenarios apply to you? Obtain a VAT ID through the request form on our company formation page, and we will take care of all your Spanish tax registration formalities.

Documents required by the tax authorities to get the VAT

Various papers are needed in order to register the VAT ID. It’s a good idea to get them all at once rather than waiting for them one by one. You will get your VAT number during the incorporation of your company. The general documents you will need for the VAT registration are:

  • The filled-in application form.
  • A copy of a valid ID/Passport
  • Proof of the deed of incorporation

If you would like the Spanish company to be under your home country’s holding company, you will need:

  • VAT certificate
  • Articles of Association and Bylaws
  • Certificate of incorporation

Because every company formation has different aspects, we suggest contacting a company formation agent to get your VAT number to handle all the documentation for your company incorporation.

VAT number Spain

Paying taxes using your VAT number

Like in any other country in the world, your company will have to do certain tax returns. The tax office in Spain is known as the Hacienda, AEAT, and Agencia Tributaria. The tax office will ask you to pay various taxes in Spain, including revenue tax (VAT return) and corporate income tax.

Filing VAT returns

Each quarter, you must file a revenue account for VAT purposes. For the first year, it is recommended that this happens based on three.

Your VAT in Spain is used to report your taxable income and revenue tax. Typically, your VAT return in Spain is due four times a year, quarterly and one time annually. It is also possible that you need to file monthly VAT returns.

The regular value-added tax rate (IVA in Spanish) in Spain is 21%. However, there are also other rates which are 10% (for basic items like food and medical products), and 4% (for even more basic items like bread and books).

Filling corporate income tax

Corporate income tax in Spain is 25%. The corporate income tax filings have to be done after six months ending the financial year, within 25 days. So usually between 1 July and 25 July of the following calendar year.

The tax also has two advance payments during the first six months of the company’s tax year and the second before the end of the year.

Where can you find a company’s VAT number in Spain?

In general, every company with a commercial establishment in Spain must display their VAT number on invoices, letters and commercial documents. In the case of online business, it is necessary to have a national VAT number that anyone can find on your website or invoice. Spain’s tax authorities are strict about companies not displaying their VAT number, so it is important to get your company registered for this purpose.

Verifying VAT numbers

If you can’t find a company’s VAT number, or you want to verify a company’s VAT number. You can look it up at the mercantile registry if it is registered. There are also other websites that index VAT numbers of Spanish companies, so there are various options.

VAT Number in Spain

Frequently asked questions

Below, you can find some frequently asked questions regarding the VAT number Spain.

Are NIF and VAT the same?

No, NIF and VAT are different. The NIF is the Spanish taxpayer’s identification number as established by law. Meanwhile, the VAT number is a commercial identifier that only companies need to have. The NIF is sometimes called NIF-VAT.

How do I get a Spanish VAT number?

To get a Spanish VAT number, you need to register as a company in Spain. Registering as a company includes getting all the necessary documentation and formalities for your business purpose, including obtaining a vat number. We will provide all the information regarding this process after we have received your request.

Do I need a VAT number when I have sales in Spain, but I am in another country?

When you have distance sales of over 35.000 euro, the Spanish government requires you to have a unique identifier. The sale of goods or services to Spanish customers is illegal in excess of this threshold.

Do people in Spain also have a VAT number?

Citizens and residents in Spain have a NIF number, which functions as a VAT number. Non-residents in Spain that need a tax identification number will get an NIE number.

Can I get an NIE Number or NIF number when I am abroad?

Yes, via The Hague Apostille, you can get a power of attorney signed in Spain. Your lawyer, who will be your Spanish representative, can then take care of your Spanish company formation and sign you up in the trade register.

Save time getting your Spanish VAT number

Get help from an expert and save time, money and headache. We offer a range of services from company formation to tax accounting. Fill in the form below, and we will get back to you right away.

Disclaimer: Information on this page may be incomplete or outdated. Under no circumstances should the information listed be considered professional legal advice. We highly recommend seeking guidance from a legal expert if you lack extensive knowledge or experience dealing with any of the procedures outlined in these articles.

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The NIF number and CIF number are often used interchangeably when speaking about tax identification numbers for businesses. It can be quiet confusing when you are forming a company in Spain. In this article we discuss why this is the case, and what the codes really stand for.

The CIF number was replaced by the NIF number in 2008

In 2008, the NIF number replaced the CIF number as the Spanish tax ID for businesses. Before 2008, the NIF number was only used for residents. Currently, both businesses and individuals use the NIF number as their tax id number. Below is more information about the differences.

What is the CIF number?

The CIF number stands for Código de Identificación Fiscal. This was the tax ID for all Spanish businesses up until 2008, with the entry into force of the Royal Decree 1065/2007, 27th of July (in Spanish, the Real Decreto 1065/2007). The CIF number was a tax code that all companies needed to have. The code helped keep records of their business and their employees in order to report and pay taxes and social security contributions within the appropriate time frame. It was then replaced by the NIF number, also known as Número de Identificación Fiscal. Currently, you will need a NIF number to start a business, and it serves the same function as the CIF used to do, only now the name has changed.

The CIF number is still mentioned very commonly in Spain for identifying business numbers. When you are searching for a business number, it makes sense to search for a CIF, because then it is clear you are looking for a business right away, and plenty of sites still have the CIF number instead of the NIF one. Google also indicates that two to three times more searches are done on CIF numbers (red) compared to NIF (blue).

Many business websites still refer to business tax numbers as the CIF number. For example, if you want to find SpainDesk’s CIF number you can see that other websites also refer to our tax number as the CIF number. As we have mentioned, it is not weird to use the CIF number to still refer to businesses. Old habits are sometimes hard to change.

NIF and CIF number

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What is the NIF Number?

The NIF number stands for Número de Identificación Fiscal. Translated to English, it means it is a Spanish tax identification number. It is a unique identification number that facilitates the payment of taxes and regulatory compliance. It is a key identifier for the Agencia Tributaria.

There is no separate number VAT number in Spain. So, if you are dealing with a business, you can also find this number on the invoices.

When do you need the NIF number?

If you are participating in any economic activity in Spain, you will need to get a NIF number. The NIF number is used for both people and businesses that need to pay taxes in Spain. So when you are starting a business in Spain, you need to get a NIF. Below we discuss the tax identification numbers related to Spanish citizens, ex-pats, self-employed, and businesses.

Spanish citizen: You will have your own personal NIF number when you are a Spanish citizen. This number is necessary for many formalities, such as opening bank accounts and signing contracts. This number will also be required when paying taxes or applying for a job.

Expats in Spain: When you are an international in Spain, you need a NIE number. This number is necessary for many purposes such as starting a business, opening a bank account, signing contracts, and working in Spain.

Autónomo in Spain: Self-employed people in Spain are called Autónomo. Because self-employed are not separate entities from the owner, the owner will pay Autonomo tax on their personal income tax. Therefore the owner’s NIF number or NIE number is used also as a VAT number for the Autonomo registration.

Businesses in Spain: When a Spanish limited liability company is set up, it needs to get a NIF number for itself (also called a CIF number). While the owners need a Spanish tax identification number to set up the company, the company will get its own VAT number. Foreign companies also need this number to open a branch in Spain.

CIF and NIF Tax ID number in Spain

What do the numbers of the NIF number mean?

The NIF comprises nine characters: a letter followed by seven numbers, followed by a character that is either a letter or a number. The first letter in the code designates the sort of company or institution. Find below the meaning of each letter:

A. Public limited liability companies
B. Limited liability companies
C. Affiliate
D. Commendatory companies 
E. Communities of property
F. Cooperative companies
G. Associations
H. Communities of owners
J. Civil societies
P. Local companies
Q. Public institutions
R. Religious Congregations and Institutions
S. Bodies of the State Administration and the Autonomous Communities
U. Temporary Joint Ventures
V. Other types that are not defined in the other keys
N. Foreign entities
W. Permanent establishments of entities non-resident in Spain.

The two numbers following the first letter identify the province in Spain where the company was originally created. With this, you can learn a lot about the entity by knowing the NIF number.

Find a NIF number in the company registry

If you are looking for a company or business name, you can check that it is not already used by searching the companies registry in Spain.

The company registry is a database of all officially registered companies and other business entities in Spain. The information about each entity’s legal status, place of registration, owners and managers is available to the public.

Important takeaways on the CIF and NIF number

The NIF number is the tax identification number that facilitates the payment of taxes and regulatory compliance. As you can see, the NIF, priorly known as CIF, is vital in getting a business started in Spain, since every time you are dealing with tax, accounting, invoices, the Tax Office or any Spanish institutions, this is what will identify your business.

At SpainDesk, we can help you in the process of applying for a NIF number and everything that comes with forming a company in Spain. Don’t hesitate to contact us at if that is the case or you want any more information on the matter.

Disclaimer: Information on this page may be incomplete or outdated. Under no circumstances should the information listed be considered professional legal advice. We highly recommend seeking guidance from a legal expert if you lack extensive knowledge or experience dealing with any of the procedures outlined in these articles.

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When you want to start a limited company in Spain, knowing the meaning will make you feel more prepared to take on business in Spain. We have compiled a list of 9 must-knows for when you want to start a limited liability company in Spain:

It takes time to incorporate a limited liability company in Spain

Foreigners often underestimate the amount of time it can take to start a limited liability company. There are many steps involved in setting up a limited liability company in Spain, and before you make the first sale, these must be correctly done.

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Spanish business administration is often more complicated than in other countries, and this is due to its history as a relatively new democracy. While this is a negative of starting a company in Spain, it also brings opportunities as the Spanish economy is still growing and giving way for your new company to grow.

Tasks when setting up the limited liability company

For example, you have to register your company name at the mercantile registry, establish a registered office, apply for a NIF with the tax authorities, sign up for your Social Security payments, get the deed of incorporation, and recruit your employees.

We recommend allowing at least one to two months before you open the doors of your business. Especially when incorporating from abroad, consult with a lawyer to see what the exact process will be for your company.

The minimum share capital for a limited company is €3.000

To start an SL company in Spain, you must have a minimum share capital of 3.000 euros, but most companies would be better off with a minimum of 6.000 euros to 12.000 euros to run it properly and hire the proper personnel.

Depositing your minimum share capital

It is recommended that the starting capital of shareholders be deposited in a Spanish bank account. While technically, the money does not have to be deposited with a Spanish bank. It must be available for drawing any time by the shareholders or managers at their request.

Banks have unique products and services for companies, and some of them also have payment portals that are translated into a variety of languages. Dealing with banks in Spain can still be a challenge since Spanish people tend not to speak many foreign languages.

Limited company in Spain

Incorporate your company in Spain with the help of a lawyer

A specialised lawyer does the incorporation of companies in Spain typically. It is best to go with a law firm specialising in business rather than one that deals with civil and criminal cases, which could be the case if your lawyer only works for individuals. Some specialists also work through the internet and can provide you with all of the required legal documents via email.

Tasks a lawyer can handle

When you have given a lawyer the power to handle your company incorporation, they will cover the documentation and registration process.

Tasks the lawyer can handle related to the incorporation are, for example

  • Tips on choosing the type of company
  • Getting your Spanish personal tax identification number
  • Dealings with notary
  • Registering you at the mercantile registry
  • Registering you at the social security office
  • Getting your business tax identification number
  • Setting up a bank account
  • Registering you at the tax office

Additionally, the lawyer can manage business contracts and employment contracts tailored to your needs.

You need to present the company’s Spanish Articles of Association and Bylaws

The Spanish company’s Articles of Association and Bylaws must include a set of required provisions. The basic ones are the name of the limited liability company, its registered office, and shareholders. It also contains several chapters, dealing with various aspects of the corporate structure and management.

These include chapters about the rights and obligations of the company’s founders and directors. Both the Bylaws and the Articles of the Association are an essential part of your incorporation. It will explain the relationship between the partners involved in the company and their duties and rights.

Get a Spanish lawyer to write your Articles of Association and Bylaws

It is best to have a lawyer create the Articles of Association for your company. This way, you can be sure that everything is done according to Spanish law.

The lawyer can also advise you on any potential pitfalls you want to avoid when drafting your company’s Articles of Association. When written by a Spanish lawyer, they include all the needed provisions and will be prepared correctly in compliance with current company laws.

Companies must keep detailed accounting records

Every business in Spain must maintain a set of accounting records, which the business must keep records for a minimum period determined by the Spanish tax authorities. These should include a register of all your transactions and receipts from day to day, plus any legal or financial documents of the company. All businesses must keep these documents for five years. The tax office may request them during an investigation carried out by the tax office.

The Spanish public administration demands this information to prevent tax avoidance and fiscal fraud, among other things. Furthermore, annual statements need to be kept very well organised to fill in the tax return forms.

Get a Spanish accountant to take care of your tax obligations

Startups often overlook accounting records. We recommend hiring a Spanish accountant at the start. For medium and large companies settling in Spain, accountants are also essential to running the business smoothly. They will assist with paying out payroll, dividends, and avoiding tax penalties.

Hiring a Spanish accountant will free up your time and allow you to focus on what is essential: making decisions about the future of your Spanish business. In addition, accountants can keep track of all financial statements and keep invoices for you.

It’s also feasible to expand the services they provide tailored to the company’s growth. We offer services ranging from tax declarations, bookkeeping, cash flow forecasts, and payroll administration. This way you can scale your business with us accordingly.

sociedad limitada nueva empresa

The most popular limited liability company in Spain is the Sociedad Limitada (SL)

While there are other types of business structures and limited companies in Spain, The Sociedad Limitada (SL)is the most popular of them all. This is because it is easier to set up, but it does everything you would expect from a limited company to protect you from your business’s debts.

The minimum share capital of SL and SA

There is also another limited company in Spain that is popular. This is the Sociedad Anónima (SA). There are a couple of differences between the SL limited liability company and the SA limited liability company. For example, the SA has a minimum shareholder capital of 60.000€, compared to the SL’s 3.000€.

The corporate income tax rate in Spain is 25%, but newly created companies pay 15%

The Spanish corporate income tax (CIT) rate is 25%. Depending on the type of firm taxed and the kind of business it conducts, other tax rates may be levied.

You might need to pay only 15% corporate income tax for the first two years you are in business. After the first two years, this is increased to 25%.

Dates of filing your limited liability tax

The limited liability company must file quarterly and yearly corporate income tax declarations. These have to be submitted on the 15th day of the month following the quarter or yearly period that is being declared.

The yearly corporate income tax must be filed within the first 25 days of the six months following the year-end. Companies that operate on a calendar year basis (99%) must submit their tax between the first and 15th July in the following year. You must make the quarterly corporate income tax payments during the year, and they are due on the 20th of April, October, and December of the same year.

Every business in Spain also needs to declare its VAT (IVA). The general VAT in Spain is 21%. This also has to be declared on a quarterly and yearly basis.

Understanding how your business will be taxed in Spain can seem confusing, but it does not need to be an obstacle. Hiring a Spanish accountant from day one will allow you to avoid any unforeseen taxation issues and may

Limited liability company spain

Spain can offer you cheap labour, but employment issues can arise quickly

Spain has some of the best talents in Europe. You can find highly skilled workers that speak English, French, Italian, and German. There is also unlimited access to clientele, with the largest consumer market in southern Europe.

However, you need to consider ‘how’ you hire new staff since the employment laws are more complex than in most other countries. When you are a starting, it is best to keep labour costs as low as possible, so you need to be extra careful about how you hire your first employees.

Your company must provide work contracts for all its employees that comply with Spanish labour law. You can hire a lawyer if you have any questions about employment laws in Spain.

Employment must-know in Spain

When you hire your first staff members in Spain, your company must adhere to employment laws. Some essential aspects of employment in Spain are:

  • Both maternity and paternity leave is 16 weeks.
  • There is a strong focus on social security contributions and social security benefits.
  • Safety and health representatives should be in place at all businesses with more than five employees.

We suggest reading our article on employment law in Spain and contacting a labour lawyer if you have questions about hiring your first employees.

You can hire a Spanish lawyer from the outset, so there are no unexpected difficulties when starting your limited liability company in Spain. Hiring a lawyer will allow you to avoid any possible legal problems and is well worth the investment for peace of mind.

Limited Company Spain

Business in Spain is booming

Since the European market has been united, the business has been growing in Spain, and it is currently (2021) the fourth biggest economy in the European Union.

While many large multinational companies are starting their limited European company in Spain due to Spain’s cheaper labour and attraction, small and medium-sized companies are also becoming more and more common.

It seems the Spanish market will continue to grow as more companies from other European countries find their way to Spain, and the government seems to encourage investment in the country’s business market.

Common sectors where limited companies are present

Companies in Spain are working in many different business areas. Some of the more common ones are:

  • Tourism and restaurants
  • Real estate
  • Finance
  • Agriculture, farming, hunting, fishing, forestry
  • Services (including technology, finance, and consulting)
  • Retail

There are also many other sectors where Spanish companies are working. If you have a business idea that can be developed in Spain, take into account the growing Spanish market. You could be part of the economy’s monetary growth, and there are a lot of opportunities to build a successful business.

Concluding the must-knows for setting up a limited company Spain

The limited company in Spain has some necessary legal requirements. Suppose you want to start a Spanish Limited company (Sociedad Limitada) or an SA (Sociedad Anónima). In that case, you need to carefully check the legal requirements and be aware of the consequences when not complying with them.

We recommend contacting a certified Spanish lawyer to help you with the limited liability company formation in Spain. Next to this, an accountant in Spain can help you with the tax requirements the company will have. We would be happy to provide you with these services and support you with the success of your business in Spain.

Disclaimer: Information on this page may be incomplete or outdated. Under no circumstances should the information listed be considered professional legal advice. We highly recommend seeking guidance from a legal expert if you lack extensive knowledge or experience dealing with any of the procedures outlined in these articles.

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The UK’s exit from the EU became an eye-opener for businesses, public administrations, and citizens when they understood the various trade barriers this exit would bring to their doorsteps. If you consider starting a business as a UK citizen in Spain, you should be careful with the new rules and regulations you will run into as a non-EU citizen. It is therefore recommended to hire a lawyer that can assist you with the new obstacles in tax, trading, and starting a company formation. This article is intended to provide information about the changes for UK individuals who want to start a company in Spain.

Can I start a business in Spain after Brexit?

You can still start a business in Spain since you don’t need to be a resident to start a business in Spain. If you want to incorporate a new company, our bilingual corporate lawyers can help you with everything. You can read more about our services on our company formation page. Next to this, we have another article that explains the complete process of starting a business in Spain.

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What new requirements and taxes are after Brexit in Spain?

At the end of December 2020, new tariffs, duties and compliance’s for UK citizens were implemented. It is important to meet all the necessary standards of imported or exported goods and conform to international legal and trade obligations. Just like the UK, these new policies will help prevent illicit activities and smuggling of products, including foods, disease control, and safety products for Spain and the EU

Moreover, the customs would give an affirmation that will aid the governments in collecting information about the specific products after importing or before exporting every product. The customs declaration will have information on the type of goods, value, shipment method, tariffs or duties paid. Likewise, different checks and licenses might be required and applicable for importing goods, such as plants, animals, animal origin products, agro-food products, pharmaceuticals, chemicals, alcohol, tobacco, etc. You can find more about these policies here.

Companies should also make a point to check the personal data shared between UK and EU businesses and make sure they comply with the General Data Protection Regulation.

Another one is that if you sell digital goods online to Spanish customers, they should be recorded either in the Spanish VAT system or an EU VAT MOSS system.

Our corporate lawyer is ready to assist you with the forms and regulations you will have to go through. Just contact us, and we will be happy to help you with your situation.

Popular companies you can register in Spain

Depending on the type of company and activities you want to start in Spain. Foreign investors must register either the limited liability company which is privately held called the SL (Sociedad Limitada) or the public limited company called the SA (Sociedad Anónima). There are many differences between the S.L. and S.A. For example, the SL limited liability company requires an investment of 3.000 euros and can have 1 to 50 partners, the Sociedad Anónima a minimum of 60.102 euros and can have an unlimited amount of partners. Both have different aspects that make them interesting for individuals and organisations.

At SpainDesk, we can provide financial and legal assistance and support you through the company incorporation process, as well as the bookkeeping and accounting. Contact one of our lawyers to get a free quote.

Living in Spain after Brexit

If you want to start a business in Spain, and want to live in Spain, then you need to apply for a visa. When you are starting a business, most likely this will be applying for a Business Visa or Self Employed Work Visa. We suggest contacting us for consultation with our immigration lawyer. Additionally, if you are willing to invest about 500.000€ in the Spanish economy, including real estate or qualified financial investments, you can apply for a Golden Visa in Spain. Having a work permit makes it eligible for you and your family members to reside in Spain as well. You can also use in the Beckham law to live in Spain but as a non-resident.

Living in Spain with the Beckham Law

Individuals that will be working in Spain can also apply to the Beckham rule if they are qualified. It licenses you to live in Spain but as a non-resident. This option comes with a unique tax regime at a fixed rate of 24 per cent of your Spanish employment income, unlike the progressive tax rates applicable to Spanish residents. We can help you with your application for the Beckham rule, take care of your tax declarations, and provide you with practical advice.

Living in Spain for ex-pats that arrived before Brexit

British ex-pats that were already living in Spain before the Brexit can register as a resident in Spain at the Immigration Office (Foreigners Office). As a resident, you will be able to get health care, a driver’s license and enjoy other resident perks. If you would like assistance with this, our lawyers can help.

Living in Spain ex-pats that arrived after Brexit

British ex-pats that want to move after Brexit to Spain will need to meet the normal Spanish immigration requirements for countries outside of the Schengen territory. This also means that UK Nationals that want to visit Spain are subjected to the following rule: you can stay 90 days in any 180-day period within the Schengen area. Just like the Spanish immigration requirements, this rule applies to countries outside the EU If you would like to know more about living in Spain for UK nationals, we would suggest looking at the official information from the UK government.

Disclaimer: Information on this page may be incomplete or outdated. Under no circumstances should the information listed be considered professional legal advice. We highly recommend seeking guidance from a legal expert if you lack extensive knowledge or experience dealing with any of the procedures outlined in these articles.

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Are you interested in recruitment agency services in Spain? Or would you like to get in touch with one? Maybe you are starting a company in Spain, or want to expand your already established company. In this blog, we go through the basics of recruiting in Spain. The meaning, recruitment services, international recruitment, and the basics of the Spanish labor market will be discussed.

What can a Recruitment Agency in Spain do for you?

A recruitment agency in Spain is an organization that, as the name suggests, recruits people for various types of work in Spain. These can be temporary or permanent vacancies at any level in a company.

Next to this, they help companies find the right talent for their vacancies. They do this by using a range of methods to attract candidates, from placing job ads online to finding them on social media.

They are also known as ‘head hunters’ because they are tasked with hunting down candidates with extremely specific skill sets who are ideally suited to particular jobs.

International recruitment agency

Spain attracts many international employees to work in the country. Many companies like to take advantage of this by hiring staff from abroad. In this way, many companies are looking for an international recruitment agency in Spain.

Getting experienced multilingual candidates to give your business support in Spain is an attractive option for many companies in Spain. It’s possible to find talent from countries around the world that are attracted to the Spanish culture and lifestyle. Multilingual professionals will come to Spain for the following:

  • A great climate.
  • An international business culture.
  • Many multinationals or partners of multinationals have a presence.
  • A great lifestyle.
  • The people are friendly, helpful and interesting.

Popular industry sectors in Spain

The following list shows the most common sector companies are searching for candidates.

  • Customer support
  • Real estate
  • Horeca
  • IT jobs
  • Accounting or administration jobs
  • Healthcare
  • Engineering
  • Transportation (automotive)
  • Construction
  • Education
  • Tourism
  • Marketing
  • Social work
  • Insurance
  • Commerce
  • Finance
  • Consulting
  • Sales

Recruitment agency in Spain

Where can you find recruitment agencies in Spain?

You can find recruitment offices in most regions of Spain. However, international recruitment agencies are spare. Next to this, most recruitment agencies are located in big cities like Madrid, Barcelona, Valencia, and Sevilla.

What are some benefits of using recruitment agencies in Spain?

A lot of companies like to work with a professional recruitment agency for several reasons:

  • They can help them find the right talent for their vacancies. By working with the right candidate they increase the chances of attracting new clients.
  • An agency can also help companies manage their P&L, by finding the best candidates who contribute to the right outcome.
  • Hiring quality employees is always a tricky process and choosing an employment agency will help you save time and money.

How can you benefit from our services?

Below we split up the services we offer for companies and job seekers.

Services for companies

  • Selection of potential employees.
  • Placement in companies and making sure that all parties are satisfied with the outcome.
  • Regular updating about your open vacancies.
  • We provide professional advice throughout the placement process. This includes support for interviews and assessment centers.

Services for job seekers

When you are looking for a job in Spain, working with a recruitment agency can be a great option. You will find a wide range of different vacancies and you don’t have to worry about the initial contact or selection process.

The most important tasks for us are:

  • Providing you with interesting job opportunities.
  • Assessing your skills and experiences to make sure they fit the position you are applying for.
  • Supporting you with the job application process and making sure that all parties are satisfied at the end of it.
  • Recruitment agencies can help you find jobs fast.

Types of services for businesses

Our recruitment, payroll, and staffing solutions are tailored to your business needs. We offer a wide range of services.

HR Consulting

Our employment lawyers and professionals can help your human resources team with all legal issues related to employment law in Spain, such as:

  • Preventing and resolving disputes.
  • Legal advice on recruitment processes (hiring and firing procedures,…)
  • Labor law compliance (contracts, salaries,…)

Executive Search Services

Executive search is related to long-term missions in which you hire a top executive to join your company.

We will do an in-depth analysis of the market to find the perfect candidate for your company.

Permanent Placement Services

Permanent placements are ideal for your business if you are looking to speed up the hiring process and find a good candidate.

The right number of qualified specialists and employees is essential for every company’s success.

Temporary Employment Services

This type of employment service is the right choice when you need to fill a temporary position.

Temporary workers are ideal for short-term projects to help you face peak periods, bad weather conditions, longer holidays, or other temporary circumstances.

Job search and recruiting

Our recruitment services as a multinational company

We both recruit Spanish talent and talent abroad. Below you can find our main services.

Recruitment of Spanish talent

Recruitment agencies can help you find the best candidate to work abroad for your company. The number of Spanish professionals looking for opportunities outside Spain has been increasing over the last ten years, which you can benefit from if you find the right person. Our recruitment team will thoroughly assess the Spanish market and find you a perfect candidate to work in your company. Whether it be a person working in engineering, finance, tourism, or any other sector.

Recruitment of people in Spain has many benefits, Spanish people are well-educated and open to learning. They are also very family-oriented and like challenges.

Recruitment for talent abroad to work in Spain

Spain is an attractive place to work for a lot of young people, but also professionals from all over the world are looking for exciting opportunities in Spain. However, finding these people can sometimes be a challenge. That is why we have a large network of foreign professionals and can find you the right candidate for your business in Spain.

Our recruiters can find the right people for your business, whether you are working in tourism, finance, sales, engineering, or any of the other sectors.

How much does it cost to hire a recruitment agency in Spain?

The cost we charge depends on the task you want us to do. An initial assessment of your requirements can be done at no cost. So we can determine what kind of services and cost best suits your company.

The 5 types of cost structures we offer are:

  • Payment when a candidate accepts the job.
  • Percentage of the candidate’s first year’s salary (which is paid by the employer to the recruitment agency).
  • Fixed fee for searching candidates.
  • Monthly retainer fee.
  • Retainer plus a payment per head.

With these different cost structures, we can help you create an offer that suits your business best.

The costs and structure also depend on the number of positions you want us to look for, the level of candidates, and the difficulty of finding and placing them. The cost also depends on secondary services, such as whether you want us to handle the payroll for your new hires.

We have a transparent and straightforward fee structure that we will explain before you sign the contract with us. We are always looking for a long-term business relationship with our clients, which starts with transparency and is based on trust.

Finding workers for your business

Contact our team to discuss your opportunities.

We will advise you on recruitment in Spain and the best way to go about hiring new employees.

Our team offers a wide range of services from temporary placements to permanent staffing, and we are happy to help you every step of the way. Next to this, we can take care of:

Don’t hesitate to contact our team if you want more information about the services we offer.

Disclaimer: Information on this page may be incomplete or outdated. Under no circumstances should the information listed be considered professional legal or financial advice. We highly recommend seeking guidance from a legal or financial expert if you lack extensive knowledge or experience dealing with any of the procedures outlined in these articles.

The SL Company in Spain is the most chosen limited liability company for the Spanish market. The reasons why are pretty understandable since this legal entity provides many advantages. In this article, you will find the basic information about the structure, benefits and restrictions, registration and tax obligations that come with this business form in Spain.

What is the Spanish SL?

SL stands for Sociedad Limitada. It is a legal form of business in Spain and provides entrepreneurs with a simple and easy-to-start company structure. It is similar to the US limited liability company (LLC) and the German GmbH, but it has some additional requirements to its structure.

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The main purpose of this business form is to provide limited liability protection to its owners (shareholders) since they are not personally liable for the company’s debts or obligations.

Spanish SL company

What are the main characteristics of SL Company?

The most significant features of the SL are the following:

  • It is the leading limited liability company for start-ups and medium-sized companies.
  • Its minimum founding capital is 3,000 Euros.
  • The maximum number of shareholders is 50.
  • The capital of an SL company is divided into shares.
  • The minimum requirement for the founding members is one person, which can be natural or legal.
  • The shareholders can freely trade the shares of the company.
  • It is possible to create an SL company through a sole shareholder.
  • The company’s articles define the decision-making and shareholder percentages.
  • An SL Company has its fiscal domicile in Spain.
  • An SL Company is subject to Spanish Corporate income tax of 25%.
  • The legal form requires a separate VAT (IVA) number registration.
  • The General Meeting of Partners, the administrators, and member rights are components of a Limited Company.
  • The Spanish Mercantile Registry holds the company registration (Registro Mercantil).

SL Spain

The benefits of the SL limited company in Spain

The main reason why the SL Company Spain is so popular for many entrepreneurs and investors. Because it offers many benefits that other business models do not provide. The main benefits are:

  • Low share capital required.
  • Limited liability for directors.
  • Not personally responsible for any debts.
  • No social security necessary for owners.
  • International recognized corporate form.
  • The sole director and administrator can run it.

The disadvantages of an SL limited liability company in

There are a few disadvantages with going for the SL Company in Spain. Some of the disadvantages are:

  • For the final documentation, a public notary in Spain is required.
  • A registered office in Spain is necessary.
  • A share capital of 3.000 euros is required.
  • In some cases, fiscal monthly tax return.
  • Must adhere to corporate governance requirements.
  • Shares can not be traded or capitalized on the open market.
  • For shareholders who do not work for the company, no dividends are permitted.
  • SL Company can not have more than 99 shareholders.

Initial Investment SL spain

The initial investment of shareholders

The initial shareholder investment is a minimum of 3.000 euros. The cash capital is paid to the companies bank account when the company is registered. After incorporation, the directors/management of the company can use the money to invest in the companies activities.

Corporation tax for SL companies

The main corporate taxes involved with the SL entity are corporate income tax and VAT (IVA). The corporate income tax applied to this business form is 25%, while the VAT (IVA) applies to all of the company’s transactions.

There are also other taxes involved related to your business activity. For example, you will need different fillings for real estate, vehicle ownership, employees, import-export, construction, transport, tourism.

SL in Spain

The risk associated with this type of limited company

Loss of initial investment: The shareholder of limited liability will lose his initial investment/capital contributed to the company.

Loss of limited liability: By not keeping separate bank accounts, following the Spanish law, and keeping accurate records, companies may fail to properly keep a gap between the company’s business assets and the members’ personal belongings. Consequently, in the course of litigation, a court might find grounds to pierce the veil and target personal belongings.

Time waste on tax declarations: The corporate tax regime and form filing obligations involved need to be done. If you need to do this yourself, you might waste a lot of time figuring out the proper processes.

Disputes between shareholders: Because this Spanish limited liability company often has multiple managers, the members may come into conflict. While these disputes can be healthy for the business and help the business grow, some arguments might be more severe and irreconcilable. It is good to have the bylaws checked by a corporate lawyer, so everybody knows their responsibility before signing it at the public notary.

Questions around the Spanish SL

Frequently asked questions

Below you can find some frequently asked questions about the SL Company in Spain. To provide you with an even deeper understanding of the SL limited liability company.

How to form the SL limited company?

If you want to form an SL, we offer company formation services in Spain. As soon as we create the company, we can provide you with fully-managed accountancy and administrative assistance.

How long does the company formation of an SL Company take?

The registration process for an SL Company can take up to 90 days. However, all necessary documents need to be submitted correctly to make this timeline. The Registry Office may impose an additional term if required papers are missing or incomplete. However, three months is often the registration time for foreigners.

What is the minimum required share capital for an SL Company?

There is no minimum capital requirement. However, it must be at least 3,000 Euro. It can be more than that amount or even less if preferred by

What are the differences between the Sociedad Anónima entity and the Autonomo entity?

The Sociedad Anónima is a limited liability entity, while the Autonomo is not. Furthermore, Autonomo can only be sole traders (freelancers), while the SA company can have multiple shareholders.

What do I need to hire someone in Spain?

When you want to put someone on payroll in Spain. You will have to register with the social security office, and request a social security ID for each employee you hire. When you hire someone, withholding of payroll taxes and social security contributions are necessary. Contact us for more information on our payroll services in Spain.

Can I use the Spanish SL business structure as a self-employed person?

Yes, there are no restrictions for individuals to use the SL Company as a business entity. Because you can operate as both director and administrator, you may have a single owner.

What are the differences between a Sociedad Anónima and the Sociedad Limitada?

The Sociedad Anónima is a limited liability company that follows similar rules as those for a Sociedad Limitada Company. Large public companies will use the Sociedad Anónima because they have numerous shareholders and partners.

  • Minimum Share capital: The minimum capital required is 30,000 Euros for an Anónima, while 3,000 euros for an SL Company.
  • Shareholder limit. There is no limit on the number of shareholders for an SL Company, while it is 50.
  • Registration process. The registration process takes longer than it does with the SL company.
  • Fiscal returns. The fiscal returns are more complex for a SA company.
  • Headquarter: as its place of business in Spain while the SL Company does not have to do so.

In general, starting with an SL Company is recommended, and you can always change to a Sociedad Anónima if you prefer. If you would like to learn more about the differences, you can read them in our dedicated blog about the SA company in Spain.

Spanish limited liability company

How does the decision-making process work within a Spanish SL?

By default, a majority of shareholders will make the decisions. However, the shareholders can change the articles of incorporation to increase the required level of majority.

Do I need a lawyer to set up this company?

While Spanish law doesn’t require you to set up a limited company with the help of a lawyer, most of the time, people use a lawyer to set up an SL Company in Spain. It is common to use a lawyer if you do not experience Spanish corporate law.

Can I register the company without going to Spain?

Yes, that is fine. You can employ a lawyer or law firm in Spain to register for you.

Are there any restrictions on foreign shareholders?

No, foreigners and non-residents can own shares of a limited liability company in Spain.

Company formation of Spanish SL


An SL Company is your leading choice if you want to set up a business in Spain. In comparison, it is similar to the Sociedad Anónima company on paper. However, it has fewer costs and responsibilities and is perfect for medium-sized companies. Furthermore, the registration process for an SL Company does not take as long as that of a SA company. Finally, there are no restrictions or requirements on who can be a shareholder or a director of an SL Company. If you want to form an SL company, we can take care of the accountancy and company formation.

Disclaimer: Information on this page may be incomplete or outdated. Under no circumstances should the information listed be considered professional legal advice. We highly recommend seeking guidance from a legal expert if you lack extensive knowledge or experience dealing with any of the procedures outlined in these articles.

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Buying a business in Spain is an excellent way of settling in Spain. In this article, you will find more information on buying a business in Spain.

Why buy a business in Spain?

If you are thinking about settling in Spain or just want to enjoy some time off, there is no better way than by acquiring your very own business. Buying any type of business has the benefits of taking on an existing revenue stream and giving you stability as well as flexibility at the same time.

This means that you will still have money coming in, even if you do not feel like working. It is also an excellent way to settle into Spanish life because it allows you to take on a new project and work towards making something that is better than before.

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Spanish Business Market

The Spanish business market is best known for its booming real estate and tourism sector. This means that it would be a very good idea to buy a business in either of these sectors if you want to settle into the country quickly and easily. It would also give you an excellent chance at success because there are always opportunities arising in these two markets.

Real estate businesses in Spain

The real estate market is definitely an interesting sector in Spain. After the crash in the market that was caused by the recession, many such businesses were forced to lower their prices and therefore, there is a lot of opportunity for anyone who wants to invest in this sector.

Another great thing about the real estate business venture is that you will be able to enjoy a new country and lifestyle while you enjoy returns from your investment at the same time making for an excellent opportunity.

When buying property in Spain, there are a few things to keep in mind. The first thing is to get a property lawyer involved when you are ready to buy. This will ensure that you do not end up spending a lot of money on a property that is not worth it. Property scams and property pitfalls are very common in Spain, so do not forget to get a Spanish lawyer involved with the actual property purchase.

Tourism businesses in Spain

The tourism industry is another great avenue to take for those looking at buying a business in Spain. This is because the country attracts many tourists every year and this also means that there are plenty of opportunities available to create new and exciting ventures within this sector.

Buying hotels, bars and restaurants in a tourist area in Spain is still very popular among foreigners. It gives them access to a great lifestyle and a chance to settle fast.

Other popular businesses in Spain

Spain’s economy is still largely underdeveloped. This means that there are plenty of opportunities for those looking to take industries that are already saturated in other countries and make them work for themselves in Spain.

  • Agriculture
  • Energy
  • Retail
  • Automotive
  • Manufacturing and Industry
  • Technology and Internet
  • Financial and Legal
  • Customer service

Buying a business in Spain

What is the process for buying a business in Spain?

The process of buying a business in Spain is complex. It is therefore a good idea for business buyers to get the help of a lawyer. They can guide you through the legal steps you need to take, and give you specialist advice. Below we explain the basic steps in the purchase procedure.

Consider the type of business and market

You need to know what type of new business you want to own. There are many types of companies and markets you can be in, so it is important to figure out what drives you and what you want from your company. Knowing this will help you to guide yourself in a specific direction and help you target the type of business you want to buy.

Another thing to consider is the company entity you want to own. Most people choose for the sole trader (Autonomo) or limited company (S.L. company) when buying a business in Spain.

Consider your immigration goal

What you want to do with your residential status is an important consideration when buying a business in Spain. If you want to be an ex-pat and live here, then it is best to find a way of obtaining residency before starting the process. This will ensure that you have a stable position in the country and can move forward with your business ventures without any problems. Owning a business can also give you access to a Spanish residency. So it can be an important reason for buying a business in Spain.

You can of course also own a business without a residential status, but your doing so may put you in a situation where if something goes wrong, you might have to run it from abroad. Spain offers business visa’s that

Consider own tax position

When you are staying more than 183 days in Spain, you will be seen as a tax resident in Spain, which means you will have to pay a different amount of taxes than when you are non a tax resident. Next to this, there are different tax rates depending on the income of your business.

It is important to understand what these are, otherwise, you might end up underpaying taxes or overpaying. Make sure to determine your tax position when buying a business in Spain so you know what you are getting yourself into.

Search for businesses that are for sale

Businesses may be purchased in a variety of ways. On the internet, you can look for firms that are for sale or inquire about them with friends and family. You may also consult with a business broker or an agency to discover what kinds of businesses are available on the market.

When you have found a company you like, ask for NIF/CIF number, which is the number for the company registration. You can then check if the company is still active in the business registration office. If it’s not, don’t bother further as you can’t buy a closed down company.

When you find that the company is active you can search for it online to see what it does and if it is the right business for you. If not, keep looking and don’t forget to be persistent and patient.

Searching in an agency or with a business broker can be very helpful. You will get advice from people that know the market and who have access to the best businesses on the market at all times.

Process of buying a business in Spain

Question the current owners

When you have found a company that you want to move ahead with, you want to question the previous owner before you make your investment. Make sure you ask them about the current situation of the business and what they like and dislike about it. You can do this by sending a questionnaire or conducting an interview that you prepare before meeting with the previous owner. Questions you can ask include:

  • What are the most important things to do with this business?
  • Who is your target group/market?
  • Does it have a good reputation with its clients?
  • Is this market growing or declining, and what effects does it have on the company?
  • How does new technology impact your client’s behaviour towards your company?
  • What were the major failures/successes?
  • What are good opportunities/risks?
  • What were the major weaknesses/strengths?
  • What do you value about the company?
  • Why are you selling the company?
  • Did you buy the company, and what did you pay for the company?
  • What are the financial results of the company?
  • Do you have all the necessary licenses and permits?
  • Are there any pending litigation, claims or lawsuits?
  • How many employees does this company have?
  • Which contracts does the company have in place.?
  • Are they willing to agree to a non-competition clause?
  • Who are the key customers, suppliers, and staff?
  • Does the business have any outstanding debts?
  • Is the business keeping up with tax payments?

Value the business: doing your own due diligence

After questioning the owners you will get an idea of what the company does and what its value is. This value is based on the current situation of the company, but also on what you can change to make it perform better.

Now it’s time to check the accounting, contracts, and investments the company is currently in. As a buyer you want to know everything about the company, so you don’t have any expensive surprises ahead. When doing your due diligence, you will look into the financial records of this business, and look for red flags that are worrying for you. It is always a good idea to get help from an accountant in Spain for this, so you can be sure that everything is in order.

It is also a good idea to do legal checks on work contracts, social security, and the companies market. Doing your due diligence is very important because when you become the legal owner of the business you will be paying for any failures.

Negotiate contract terms and purchase price

When you have found a business that you want to buy, it is important to understand the terms of the agreement. You need to make sure that everything is clear and transparent so that there are no surprises when it comes to the purchase.

Bear in mind that the purchase price you are willing to pay will be based on how much money you can make with this company, and not only what it is worth today. You should therefore try to negotiate for a lower price if there are problems with the company that you can fix once becoming its owner.

Submit a Letter of Intent (LOI)

When you are ready to submit a Letter of Intent (LOI) you will make an official declaration of your interest in buying the company. A Letter of Intent is usually non-binding and it can be changed later when signing, but most importantly it shows how serious you are about the purchase.

This letter is very important because when you submit one, the seller can be sure that you are there to negotiate and not just waste their time.

Complete due diligence

When you and the seller have agreed on all terms and conditions of the sale, it is now time to complete your due diligence. You want this process to be as smooth as possible since there should not be any changes that would stop the purchase from taking place.

Close the deal with the appropriate documents

Once you have completed your due diligence, you can sign the purchase agreement and transfer the payment.

Ensure that all legal documents are in order before finalizing the sale. If everything is fine, make a final payment to the seller and get a title deed of the company transferred into your name.

Buying a company or setting up a new company in Spain requires certain documentation, notary procedures, and drafting of relevant contracts. Therefore, it is recommended that you consult a Spanish corporate lawyer that specializes in company formations. He or she will be able to guide you through the often local process and prevent any problems with your registration.

Running a business in Spain

Running your new business

After the buyout is completed and you own a business in Spain, it will be time to make your dreams come true. However, there are also practical matters that should be taken care of such as:

Paying taxes

When you are a business owner you will have to make sure you pay the taxes that you and your company owe. If you don’t, the Spanish authorities will come after you and take action against you.

Taxes include VAT, capital gains, social security, and corporate income tax. Our accountants in Spain can help you make the right declarations and submit your tax returns.

Hire employees

Finding employees that fit with your company can be a little difficult as a new owner. However, it is very important that the company’s workforce has the right knowledge and skills for doing their job. We can help you with the recruiting in Spain, whether you are looking for Spanish or international workers.

Next to the recruiting, we can also help you with

Pros and cons of purchasing an existing business

Below we have listed some of the pros and cons of purchasing an existing business.

Pro’s of buying a company

Some benefits of buying a company in Spain:

  • Market tested products: When you buy an existing company, the product has already been on the market for some time. This means that it is possible to receive positive feedback of customers and you will not have to invest significant time or money in the research of creating a new product.
  • Reduced startup time: If you purchase an existing business, you will be able to enter the market immediately. The company itself is already operational which means that you can receive revenue straight away.
  • The business is already established. There’s also a pre-existing relationship with trained staff members and suppliers. Furthermore, you can get easier access to loans and business financing.
  • Immigration options: Under certain circumstances, you can get a work or business visa when you have enough income generated in Spain.
  • Established brand: If you buy a company that has been in the market for many years, this means that it is possible to reach customers by simply using its network.
  • Less work: In general, your workload will be reduced because you can rely on the work that has been done before.
  • You have a better chance of success: Providing the business is doing reasonably well, it should continue to do so. After all, it means you are taking over an established brand and therefore do not need to invest as much time in research.

Con’s of buying a company

While there are many Pros to buying an existing business, there are also certain disadvantages involved.

  • You will get what you paid for: An existing business can be sold at a low or hefty price. Whatever the case may be, there’s always a risk if the market has rejected the products or if the brand is tinted.
  • Significant changes may be necessary: Some warning signs could be existing debts or cash flow issues—staffing problems, such as frequent turnover or unhappy employees. Equipment’s prone to issues or even outdated.
  • You could be cheated or scammed: In addition to the existing issues, it is possible that the previous owners misrepresented some data or didn’t provide the complete documents to the overall operations of the business.
  • It is not always stress-free to make it your own: Buying an existing business means you are stepping into someone else vision. So, there’s always more effort needed before you can make it your own.
  • Bad reputation: If the business has experienced production problems, it will negatively affect sales going forward. From legal issues to bad customer service, if patrons already have a negative impression about the business, they might not return for your outputs.

Buying a business in Spain with SpainDesk services

Our agency can help you with a variety of services related to buying a business in Spain. Our specialists can help you with buying a business in Spain as well as affairs after you bought it.

  • Proper valuation of the business: inventory, a sales record, tax returns, etc.
  • Drafting and submitting offers with conditions to the seller
  • Assistance with review of the financial statements of the business
  • Purchase guidance and advice
  • Patents & Trademarks
  • Incorporation and purchasing
  • Negotiations
  • Legal backup
  • Shareholder Contracts & Agreements
  • Payroll administration and recruiting services

Do you have any specific requirements? We can handle your ideas and give top-notch solutions to the challenge. Get in touch with us to get a quote.

Disclaimer: Information on this page may be incomplete or outdated. Under no circumstances should the information listed be considered professional legal advice. We highly recommended seeking guidance from a legal expert if you lack extensive knowledge or experience dealing with any of the procedures outlined in these articles.

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