How to set up a company in Spain?
- NIE/NIF for founders and directors.
- Corporate name inquiry.
- Bank account.
- Minimum share capital of 3.000 euros for a LLC, and 60.000 euros for a joint stock company.
- Company constitution act before notary public.
- Registration of the company before the Companies Registration Office.
- Tax and social security formalities.
Can a lawyer manage to set up a company in Spain by power of attorney?
Yes. You, however, may be obliged by the bank to sign documents in person (depending on your nationality and the rules valid on the date of opening).
For tax reasons, is it better to set up a company from a natural person or a legal person?
In some cases, it is more beneficial for dividend tax to set up a company by a legal person from other jurisdiction.
It is obligatory for a director to be a resident in Spain?
No, however, if the director is not a resident, he shall assign a representative or a CEO among Spanish residents.
Shall I assign a representative in Spanish company?
If the director is not a Spanish resident, he shall assign a representative. Also, in case of permanent establishment or a simple account opening, a tax representative shall be assigned.
What is NIE/NIF/CIF number in Spain?
NIE is a tax number of a natural person, which is necessary for almost all legal actions in Spain.
NIF is the same as NIE for a natural person, and for a legal person NIF is a tax number.
CIF is the former name of NIF for legal person.
Is the doctrine of “lifting of corporate veil” applicable in Spanish law?
Yes, and directors and shareholders may be held subsidiary liable, as well as other companies of the group.
What is the minimum share capital in Spanish companies?
The general rule is that the minimum share capital for a LLC is 3.000 euros, and for a joint stock company is 60.000 euros. However, certain exceptions may be applied. For example, for investment companies (2.400.000 euros), for a transportation LLC (60.000 euros), capital risk companies (from 1.200.000 euros).
Does director bear responsibility if he did not apply for bankruptcy in time?
Yes, the director may be held liable for not applying for bankruptcy or if he applied outside the time limit (2 months).
Can a director of a company be held liable in Spain?
Yes, director of a Spanish company bears corporate, civil, administrative and criminal responsibility.
Can an individual or entrepreneur file for bankruptcy in Spain?
Yes, both companies and natural persons can be declared bankrupt under Spanish legislation.
Who is “gestor” in Spanish law?
“Gestor” is an accountant of the firm and shall be distinguished from a tax counselor who is responsible for better tax structuring and tax assistant in general.
How long does it take to register a company in Spain?
You shall be ready for a 30-40 days procedure. Also, it is possible to expedite the registration procedures if it is done through PAE.
What is PAE?
Qualified attorneys may be registered in a PAE database and may constitute a company within a shorter time frame. Our attorneys are registered with PAE.
What is the personal income tax in Spain?
The personal income tax is defined according to progressive scale of withholdings rate and shall depend on the autonomous region of a taxpayer, from 19% to 47% (in some cases up to 54%). For non-residents up to 24% (19% for capital gains and financial investment).
Do IT companies have tax credits and incentives in Spain?
Yes, for IT companies Spain has included
What is the corporate income tax in Spain?
General rate is 25%, reduced by 15% during the first two years.
What is the dividend tax in Spain?
It is calculated according to the income received: 19% – 26% (for residents). For non-resident it is 19% and may be lowered by application of double taxation treaties.
What are the VAT rates in Spain?
The standard VAT rate is 21%. However, it can be lowered to 10% (restaurants), 4% (essentials) and 0% (education).
What is the difference between sole entrepreneur and a company under Spanish law?
A sole entrepreneur is unlimitedly liable, a company is liable within the authorized capital. The first applies personal income tax, and the company shall apply corporate income tax. Both apply the same VAT rate.
Real Estate Law
Is it better for tax reasons if I buy several properties for lease?
The special CIT tax regime for companies that lease housing incentive consisting of 85% relief with respect to the part of the gross tax due related to qualifying income is reduced to 40% for the tax periods starting on 1 January 2022.
Can I acquire a hotel in Spain?
Yes, one of the most common real estate investments in Spain is acquiring hotels or vacational rental homes.
Can I buy a nursing home in Spain?
Yes, another profitable investment in Spain may be acquisition of a retirement home. It is also possible to adapt and reform hotels.
Can a lawyer buy for me a real estate by power of attorney?
Yes, a Spanish lawyer can acquire a real estate for you by power of attorney.
What taxes shall I pay if I buy real estate in Spain?
- Acquisition tax of 6-11% depending on the region (VAT for newly construed housing 10%)
- Tax of documentary acts (stamp duty): depends on the region. Varies between 0,5 and 1,5%.
- Notary public costs (depends and varies between 800 and 1200 euros).
- Registry costs (depends and varies between 500 and 1000 euros).
- Tax services (depends and varies between 500 and 1500 euros).
- You will also pay around 3% commission to a real estate agency.
- You may opt to be represented by a real estate lawyer, whose commission will be defined according to the difficulty of the case and the amount of the purchase (1,5% – 3%).
Do I need a real estate lawyer to buy a property in Spain?
You are not obliged to hire a real estate lawyer, however, it is recommended to do so because of the risks of debts, incumbrances, liens, squatting, etc. Bear in mind that only qualified attorneys are entitled to render legal services. Real estate agencies and non-qualified lawyers cannot legally do so.
Can I buy real estate with cryptocurrency in Spain?
Yes, there is no prohibition in Spain to acquire property in cryptocurrency, however, there are a very few offers by now.
Is there a law for start-ups in Spain?
The new Start-up act entered into force in 2023 and introduces different novelties for entrepreneurs.
Can I claim aid, grants and subsidies for my start-up in Spain if I am not a resident?
Even if you are not resident, your start-up company can claim the same benefits as the Spanish residents.
Can I file for a residency permit in Spain?
Yes, you can file for a residency permit in Spain both from your country (Spanish Consulate) and from Spain. You need to check out the visa options for your case.
How to get licenses and authorisations in Spain?
It depends on the type of license. You shall file an application to a correspondent registry which will have a duration between 1 month and 1 year.
How do I recognize and enforce court decisions and arbitral awards in Spain?
In majority of cases, you have to file for exequatur. In some cases you can file enforcement claim directly to Spanish national courts.
Shall I draft an international contract in two languages?
It is always recommended to draft two column contracts if you act in Spain. Public bodies may claim the Spanish version, as well as the Spanish party shall be well aware of the terms and conditions of the deal.
Shall I opt for Spanish courts or arbitration in international contract?
It depends on the amount of the contract, the countries you are dealing with, your position in the deal (if you are a weak or a strong party, if you are a buyer or a seller) and where you are going to enforce the decision.