Advantages of registering a company in Spain

Spain is rightfully considered one of the most open to business and investment European countries. Any foreign citizen can establish a company on its territory by choosing the organizational and legal form that suits him: S.L. (LLC) or S.A. (AO). It does not matter whether the founder is a citizen of the country or a resident, or is in non-resident status – the rules for registering a company in Spain are the same for everyone. The only additional step a non-resident must take is to obtain an NIE number, which is both a personal and tax identification number.

Benefits of registering a company in Spain:

• Possibility of obtaining a Spanish residence permit as an entrepreneur.
• A healthy business and investment climate in a European country.
• Confidence of Spanish and European banks in obtaining credit loans (from 2.5%) for business development and personal needs.
• The founders are not personally liable, including their property, for the debts of the company.
• The minimum share capital of 3000 Euros for starting a company.
• Ability to work with zero VAT in the case of purchasing services and goods between companies in the European Union. In the tax office, the so-called ROI is requested and obtained.

Spanish company taxes

1. Income tax – 25% (in the first two years it is possible to apply 15%)
2. VAT – 21%
3. It is possible to apply 0% VAT in two cases:

• Mutual settlements between European companies upon obtaining a European tax number (companies with work experience are easier than new ones)
• Services provided to companies (legal entities) outside the European Union.

Requirements for the future owner of the company

1. If you are not a resident of Spain, you need to obtain an Alien Identification Number (NIE de inversores) from the Spanish Consulate of your country of residence or the Spanish Police Department.
2. To start commercial and operational activities, your company must hire an administrator, who must be a mandatory resident of Spain and have the right to work. The administrator can be registered in the statutory documents of the company or act by proxy on behalf of the company.
3. You need to open a company bank account.
4. Availability of an electronic certificate for the founder and the company

Documents for opening a company

To start the process of opening a company, you will need the following data and documents:

1. A copy of the NIE administrator and passport and all founders.
2. Information about the administrator and founders (address, NIE, marital status, and type of professional activity).
3. If there are several founders, indicate the share participation as a percentage in the newly opened Company and the share of the contributed capital.
4. Depositing into the account of the future company the minimum authorized capital of 3000 Euro. If the property is used as the authorized capital, indicate which one and its value.
5. Description of the company’s activities.
6. The legal address of the company.
7. 5 variants of the company name in order of priority.
8. Company contacts: phone numbers, email, fax.
9. The need for a national accountant and tax reporting.

Stages of opening a company:

1. Obtaining the NIE of the founder of the company.

If the founder of the company is not a resident of Spain, then first of all it is necessary to obtain an identification number of a foreigner that will allow performing the necessary administrative and financial actions on the territory of Spain.

To obtain an NIE you will need:

• original and copies of all pages of the passport
• completed application form
• pay an additional fee of 9.75 Euro
• notarized documents for opening a company

Time of receipt: 5 working days.

2. Obtaining a company name certificate

This certificate confirms that at the moment there is no legal entity with an identical name. The name of the company will be indicated in the constituent documents of the company. We receive the document in the Commercial Register in Madrid.

You can provide up to 5 different variants of the name of your future company from which one will be selected in order of priority. If among the presented 5 names there is not a single free one, then it will be necessary to pay an additional 35 Euro and we will inquire again with another five possible company names. The certificate is valid for 6 months.

Time of receipt: 2-3 business days.

3. Notification to tax authorities

To start a company, you need to notify the tax authorities about your company and pay the appropriate tax.

To notify the tax authorities you will need:

• copy and original passport
• copy and original NIE
• completed application form

Processing time – 1 day

4. Issue an electronic certificate

The certificate is issued for a private person – the owner of the company, and for the company itself. Without an electronic certificate, your Hestor (remote accountant) will not be able to maintain financial statements and interact with government agencies (tax office, trade register, etc.).

5. Opening a bank account

Regardless of whether you have a bank account in Spain or not, you will need to open a new one in the name of a future company. The newly opened account must have a minimum amount of 3000 Euros of share capital.

To open an account with the Bank you will need:

• 3000 Euro share capital
• original and photocopy passport
• original and photocopy of NIE
• company name certificate

Opening period – 1 day

Bank certificate for opening a company

6. Creation of constituent documents of the company

This document is certified by a notary and includes the main provisions of the company:

• statute
• number of owners and founders
• type of activity, etc.

The company can start its activity from the moment of signing the constituent documents by a notary.

7. Payment of tax on company formation

Opening a legal entity implies payment of tax in the amount of 1% of the authorized capital of the Company. If at the time of opening the company your authorized capital is 3000 Euros (minimum), the tax amount will accordingly be 30 Euros. This obligation is governed by the current law Real Decreto-Ley 13/2010.

8. Creation of a company identification number (N.I.F or C.I.F.)

Upon the signing and confirmation of the constituent documents of the company, we request a temporary identification number of the company, which will be permanent as soon as the company is registered in the Trade Register.

9. Registration of the company in the Commercial Register

The constituent documents of the company signed by a notary must be submitted and registered in the Commercial Register.

10. Social Service Notice (PF)

To account for social payments and other labor relations, it is necessary to notify the state social service of the “creation of a new work center” in the respective city.

The time for opening a company is about 2 weeks.