Accountants and company formation in Spain

Setting up a company in Spain

To set up a company in Spain as a foreigner, you get a Spanish tax number, reserve a name, pay in the capital, sign a deed before a notary and register the company. The order matters, because each office asks for the previous office’s paper.

The sociedad limitada (SL) is the usual vehicle: among the firms Accountanty lists in Spain, 149 name the SL among the company types they set up, against 63 for the SA. Since October 2022 an SL can start with one euro of share capital, a change many older guides still miss. What follows is the legal sequence step by step, the taxes the new company meets in its first years, and the filings that keep it in good standing once it trades.

An SL needs at least one euro of capital, paid in full at the deed; an SA needs 60,000 euros, with a quarter paid in. Every shareholder and director needs a Spanish tax number (an NIE for individuals), the name comes from the Registro Mercantil Central, a notary signs the deed and the company exists once the Registro Mercantil registers it. Corporate income tax is 25 per cent in general, with 15 per cent for qualifying new companies in their first two profitable years.

Choose the right structure before you set up a company in Spain

Two company types cover almost every foreign-owned business: the SL (sociedad de responsabilidad limitada) and the SA (sociedad anónima). In both, shareholders are not personally liable for the company’s debts. Either can have a single shareholder, and that shareholder can be a person or another company (Ley de Sociedades de Capital, art. 12).

The capital rules come from the Ley de Sociedades de Capital, art. 4, with payment rules in art. 78 for the SL and art. 79 for the SA. The one-euro SL is not free of strings. While its capital stays below 3,000 euros, at least 20 per cent of profit must go to the legal reserve until reserve and capital together reach 3,000 euros. If the company is wound up and its assets do not cover its debts, the shareholders answer jointly for the gap between 3,000 euros and the capital they subscribed. Many founders therefore still put in 3,000 euros or more, because a bank or a landlord may read a tiny capital figure as a warning sign.

A branch (sucursal) of your existing foreign company is the other route. Choose between a branch and a subsidiary with a lawyer and a tax adviser, since the answer depends on the rules of your home country as much as on Spain’s.

The registered office must sit in Spain, where the company is actually managed or where its main establishment is (art. 9).

Step 1: Get a Spanish tax number for every shareholder and director

Spain identifies everyone in a company by a tax number. For a non-resident individual, the tax number (NIF) is generally the same as the foreigner identity number, the NIE, according to ICEX-Invest in Spain. You can apply in Spain or at a Spanish embassy or consulate in your own country.

If a shareholder is a foreign company, that company needs its own Spanish NIF, requested with census form 036 at the tax agency. People who will act for a foreign shareholder company as its representatives also need a Spanish NIF.

Start here, because the notary will not sign the deed without these numbers. Consulates book appointments weeks ahead in some countries, so this step often takes longer than founders expect. Once it is done, every future shareholder and director holds a number the notary and the tax agency can use.

Step 2: Reserve the company name with the Registro Mercantil Central

The Registro Mercantil Central issues the name certificate, the certificación negativa de denominación. It confirms that no other company already uses your name. You can list up to five names in order of preference, the registry reserves the granted name for six months from issue, and the certificate is valid for three months for signing the deed (Registro Mercantil Central). If three months pass before the notary appointment, you ask for a renewal under the same name.

Pick names that are clearly distinct from existing companies and that describe your business without borrowing protected terms. A refusal costs time, not just the fee. By the end of this step you hold a certificate in the company’s chosen name, ready for the notary.

Step 3: Open a bank account and pay in the share capital

For a cash contribution, you open an account in the name of the company in formation at a bank operating in Spain and pay in the capital. The bank issues a certificate of the deposit, which the notary attaches to the deed. ICEX-Invest in Spain notes that the deposit date cannot be more than two months before the deed.

For an SL, the whole capital must be paid in when the deed is signed. For an SA, each share must be at least one quarter paid. Expect the bank to run full identity checks on every shareholder and on the people who own a corporate shareholder. These checks are often slower for non-residents, and a provider that already works with Spanish banks can save weeks here. Firms offering bank account assistance in Spain are listed on Accountanty.

Step 4: Sign the deed of incorporation before a notary

Spanish law requires a public deed (escritura de constitución) for every SL and SA (art. 20). The deed records who the shareholders are, what each contributes, who will run the company and the bylaws (estatutos sociales): name, business purpose, registered office and capital.

You can sign in person in Spain, or a representative can sign under a power of attorney. A power signed abroad usually needs legalisation and a sworn translation; ask your provider or the notary which form they will accept before you sign it.

Incorporation is exempt from transfer tax and stamp duty (ITP and AJD), but ICEX-Invest in Spain notes that a nil return still has to be filed with the regional tax authority. With the deed signed and that return filed, the company is ready for registration.

Step 5: Get the company’s NIF and register it

The notary sends the deed to the tax agency to request a provisional NIF for the company and to the provincial Registro Mercantil for registration. The company only gains legal personality when the registry registers it (art. 33). Until then, its shares cannot be transferred (art. 34).

After registration you apply for the permanent NIF, within one month of registering with the Registro Mercantil, according to ICEX-Invest in Spain. At that point the company is a legal person with a tax number of its own.

Step 6: Finish the filings that let the company trade

Registration is not the finish line. Before the first invoice, a new company usually has to:

• Register for tax with the tax agency using the census declaration, which also records whether the company will charge VAT (IVA).
• File the foreign investment declaration (form D-1A) within one month of incorporation, when the capital comes from abroad.
• File the business activity tax (IAE) registration with the right activity code, within a month of starting the business.
• Register with Social Security before hiring anyone, and register each employee.
• Announce the opening of the workplace, before it opens or within thirty days after.

The deadlines above follow the ICEX-Invest in Spain guide. Directors who will work in the business also need to sort out their own Social Security position, which is where an adviser’s payroll and residency and visa help comes in for people moving to Spain.

The online route: CIRCE and the PAE

Spain runs an electronic route for creating companies called CIRCE, with a network of Puntos de Atención al Emprendimiento (PAE) that help founders file online (PAE Electrónico). At a PAE you complete one electronic form, the Documento Único Electrónico (DUE), and the system books the notary and sends the filings to the registry and the tax agency for you.

The online route suits a simple SL with standard bylaws. It still needs tax numbers for every shareholder first, a notary deed and a bank account. For a company with several foreign shareholders, a corporate shareholder or tailored bylaws, founders usually use a gestoría, law firm or accounting firm that handles the filings. Some firms listed on Accountanty state that they are registered PAE points.

Taxes a new Spanish company pays

Corporate income tax. The general rate is 25 per cent. A newly created company that carries on a real economic activity pays 15 per cent in its first tax period with a positive taxable base and in the following one (Ley 27/2014, art. 29). The 15 per cent rate does not apply when the business was previously run by a related party, when the company belongs to a group or when it mainly holds assets rather than trading.

Smaller companies have their own scale, which is changing year by year under Ley 7/2024. For tax periods starting in 2026, a company whose turnover in the previous period was below 1 million euros pays 19 per cent on the first 50,000 euros of taxable base and 21 per cent on the rest (Ley 27/2014, transitional provision 44). Check the rate for the year your company’s period starts, because the scale changes again for later years.

The corporate tax return is due within the 25 calendar days that follow the six months after the end of the tax period (art. 124). For a calendar-year company, that puts the deadline in July.

VAT (IVA). The general rate is 21 per cent (Ley 37/1992, art. 90), with reduced rates of 10 per cent and 4 per cent for listed goods and services (Agencia Tributaria). A company that will sell to businesses in other EU countries should raise intra-community registration with its adviser at the census stage. Accountanty’s VAT in Spain page lists firms that handle the returns.

Canary Islands, Ceuta and Melilla. The Spanish VAT Act excludes these territories from its scope (Ley 37/1992, art. 3). A company based in Las Palmas or Santa Cruz de Tenerife works under the islands’ own indirect tax rules, so ask a local adviser before you price your services.

Annual accounts and the yearly filing calendar

Every SL and SA keeps accounts and files them each year. For a company whose year ends on 31 December, the calendar runs like this:

1. By 31 March: the directors prepare the annual accounts, within three months of the year end (art. 253).
2. By 30 June: the shareholders approve them at the ordinary general meeting, held within the first six months of the year (art. 164).
3. Within the month after approval: the directors file the approved accounts at the Registro Mercantil of the registered office (art. 279).
4. In July: the corporate income tax return is filed.

Many new companies fall below the audit limits. A company is exempt when, for two consecutive years, it meets at least two of three limits: total assets up to 2,850,000 euros, net turnover up to 5,700,000 euros and an average of up to 50 employees (art. 263). Larger companies can find an audit firm in Spain on Accountanty.

Quarterly VAT and withholding returns run alongside this calendar. Many foreign owners hand all of it to an accounting firm in Spain from the first month, because late filings and unfiled accounts lead to penalties and can block the company’s registry sheet.

Common mistakes foreign founders make

• Following an out-of-date guide. Many pages still say an SL needs 3,000 euros. Since Ley 18/2022 the legal minimum is one euro, with the reserve and liability rules above.
• Leaving the NIE to the end. No notary signs without it, and consular appointments can take weeks.
• Letting the name certificate expire. It is valid for three months for the deed; renew it before the appointment if needed.
• Copying bylaws without reading them. The business purpose and the way the company is run (one director, joint directors or a board) are hard to change later without a new deed.
• Assuming registration ends the work. Tax registration, the D-1A, Social Security and the yearly accounts all follow.
• Choosing an adviser who does not speak your language. Of the 669 firms Accountanty lists in Spain, 286 state they work in English, 79 in French, 44 in German and 28 in Italian.

Local help with the Spanish set-up

You can follow every step above yourself, and the CIRCE route makes a simple SL quicker than it used to be. Many foreign founders still hire a local firm, because the slow parts (tax numbers, bank checks, powers of attorney signed abroad) are where local experience saves the most time.

Accountanty lists 669 accounting firms, law firms and corporate service providers in Spain, and 592 of them offer company formation. The largest groups are in Madrid (149 firms), Barcelona (127), Valencia (75) and Malaga (61). Read how to choose a company formation provider in Spain before you compare quotes.

To set up a company in Spain with a firm that fits your plans, send one free quote request through Accountanty. Accountanty checks it and forwards it to suitable firms, which reply with their terms.