Requirements to open a business in Spain

 

Setting up a company in Spain basically requires it to be incorporated before a Notary Public  and filed in the Companies Registry. To this end, and broadly speaking, the following steps must be completed:

  • If done through a representative, the founder(s) must grant a power of attorney to the person incorporating the company.

**What are the requirements for formalizing a valid power of attorney in Spain?

The power of attorney must be granted by a person with sufficient standing: either the actual principal if it is a natural person, or an authorized representative or manager with sufficient powers if the principal is a legal entity.

In the case of a foreign legal entity or foreign person, the power of attorney is usually granted in their country of origin or in the Spanish consulate. In first case, the principal must appear before a Notary Public in the country in which the power of attorney is granted. The power of attorney must be legalized with the Apostille of the Hague Convention of 1961, if the country in which it is granted is a member. If the country in which it is granted is not a member, the procedures for legalizing documents in that country should be followed. A sworn translation is required if the power of attorney is not in Spanish. In case the POA is granted in the Spanish consulate, neither the sworn translation not the Hague Apostille are needed.

In both cases, the principal must bring with them the document certifying their capacity and entitlement to grant the power of attorney.

  • Application for a Tax Identification Number (“NIF”), in the case of a legal entity, or Foreigners Identity Number(“NIE”), if a natural person, for the foreign partners and directors of the company being set up.
  • Application for a company name clearance certificate. Register the company name at the national Mercantile Register, making sure the name chosen is unique.
  • Draft the statutes and by-laws for the company’s constitution.
  • Open a current account to deposit capital allocations and obtain bank certification.
  • Incorporation of the company before a Notary Public through issuing the articles of incorporation. Go with the client to sign at the notary’s office/act on behalf of the client with a granted POA.
  • Application for a provisional NIF (tax identification number) for the company.
  • Payment of Asset Transfer Tax.
  • Present the Foreign Investment declaration.
  • Filing with the Companies Registry.
  • Obtaining the company’s definitive NIF (tax identification number).
  • Legalization of the business’ official books and ledgers.
  • Tax formalities.
  • Employment formalities.

(1) In Spain, a “notario”, a state official with the powers of a Notary Public

We guarantee that all the required tasks to form your company will be completed and you will receive:

  • Company name certificate.
  • Company deed, including shares, bylaws, and title of ownership.
  • Company tax ID.
  • Registration at the Mercantile Registry and publication in the Registry’s Official Bulletin.
  • Form 600 (stamp duty) filed.
  • Form 036 (tax ID registration) filed.
  • D1A foreign investment filed

If you use our accounting and payroll services, all related documents for these services will also appear in your client area.

What are the costs?

You can either choose our flat fee of 2.500€ for company formation, or choose our offer of free company formation when you pay one year of our accounting service (3500 €). For both options, all the costs to fully create and register your “sociedad limitada” are included. The name certificate, notary and mercantile registry fee are paid by us.

Note that when you form a company in Spain, there are accounting and tax filing obligations. Keep this in mind when adding up the costs of establishing a company in Spain.

How long will it take?

Once you have your NIE or the company has it CIF, the time scale for the company to be fully established is between 3 days and 3 weeks (depending if your company requirements fulfill the new regulations) Please contact us for more information.

What are the tax and accounting obligations for a company in Spain?

You are required to file tax forms every quarter, as well as yearly tax forms. You are also required to fill out four accounting books, and present them yearly to the Mercantile Registry. These requirements hold true even if your company has no financial movement.

Do I need an address in Spain for the company?

Companies incorporated under Spanish law are required to have a registered address (domicilio) in Spain. Your SL will be registered at the provincial Mercantile Registry corresponding to this corporate address. It is the public address that shows up if anyone does a search on your company, such as a credit search or a search for judicial reasons. It is also where your year-end accounting books get sent to.

If you choose to use our accounting service, then our address may be used for your registered address.

What is the minimum capital required for the company?

The minimum capital required is 3000€. This money is put directly into the new bank account for the company. You may withdraw this money from the account as soon as the bank account is fully set up or contribute to the social capital with assets valued in 3.000 €.

If you are interested in getting more information you could contact us.

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