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Growing your business often means expanding into foreign markets and countries, like Spain. Starting a business in Spain comes with many advantages such as:
- No business tax
- Monthly or quarterly VAT reimbursements
- Lower social charges
- And more…
With so many beneficial reasons to expand the scope of your company and promote economic growth, why not begin by registering a company in Spain?
What are the initial formalities for starting a business in Spain?
When starting a business in Spain, you must register as an employer and create your “Código de Cuenta de Cotización” on the Social Security system. This is a contribution account code which is assigned to you when you register and is part of the control and obligations of the Social Security system.
It is important to note that this code is mandatory for each autonomous community where your company is based.
Then, you must submit your request to the General Treasury of Social Security (Administración de la Tesorería General de la Seguridad Social) closest to your location.
Finally, identify the type of company you are registering.
There are two main types of companies in Spain, made up of two subtypes. Registering as the correct Spanish company type is vital for starting a business in Spain as a foreigner.
Civil company
This type of company is governed by a contract in which all signatories agree to pool money, goods and work, with the aim of sharing all profits made.
- No minimum capital
- Unlimited liability for each partner
Universal civil company
Two scenarios:
- Pooling of all goods – profits made from these are shared.
- Pooling of profits only – each asset is owned by a partner: only the profits obtained from the usufruct of these assets are shared.
Private civil company
Commercial company
This type of company with a legal personality (unlike civil companies) is created to undertake profit-making activities. The shareholders must share equally in the losses and profits of the company per their common goal.
- Minimum capital of €3,000
- Limited shareholder liability
Limited liability company
- This is the most common type of company in Spain. Regarding paying off debts, shareholders do not have to use their personal assets to pay them off.
- Once profits reach 40,000 Euros, taxes are lower than those of a self-employed person.
Public limited company
- This is the second most common type of company in Spain. Its capital can be freely distributed among its shareholders.
- A minimum capital of 60,000 Euros is required for its constitution (25% of which must be paid when the company’s by-laws are made).
How to get NIE number in Spain?
Before starting a business in Spain, you must obtain a Spanish NIE.
The NIE application process only costs around €10, which is very economical and provides you with everything needed for company registration Spain, such as access to administrative procedures, social security, opening a bank account, certification of diplomas, driving licence and more.
However, this bargain of a price is the reason for the long waiting lists. There is a faster way to obtain NIE in Spain without going through the appointment process, which is with the help of a lawyer, but it comes at a higher price of around €100.
Partnering with a trusted law firm
Delaguía&Luzón is a Franco-Spanish law firm based in Valencia, Spain. We offer a wide range of legal, social and tax services, aimed at companies and individuals wishing to settle in Spain.
We pride ourselves on providing accessible and personalised solutions for foreigners who wish to reside in Spain.
We also provide continuous follow-up solutions with our clients, to improve their decision-making from a legal point of view, including annual tax services and accounting.
Don’t hesitate to contact us for any additional information or to get a free quote.
