Are you considering expanding your business internationally? There’s one country you might have overlooked in your considerations, and that country is Spain.
Spain offers business-friendly regulations, beneficial tax rates for business and a steady economy. As a matter of fact, Spain has one of the strongest and most stable economies in all of the EU.
In this post, we describe how to obtain a business registration in Spain.
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Register as a Private Limited Liability Company
The most popular form of business registration in Spain is the private limited liability company (sociedad limitada laboral). It is important to remember that before you can start the process of setting up a business in Spain, all non-resident foreigners with financial affairs in Spain must have a foreigner’s tax identification number or NIE. You can make your application for an NIE at a foreigners’ department of a national Spanish police station.
The Spanish limited liability company has several important features. Each member is liable only up to the amount of their contribution to the capital. The capital is divided into non-transferable shares. The minimum share for capital is a bit more than EUR 3,000. Further, you must deposit the capital to a bank account when you open a company in Spain. The general meeting of the shareholders (members) has the right to appoint a director and make all major decisions in the company.
What Are the Benefits of Registering as a Private Liability Company?
What are the advantages of registering as a private liability company in Spain? The first and probably the most important advantage is that if you register as a limited liability company your liabilities with third parties are limited to only the company’s assets. In contrast, if you work as an independent worker you would be liable with your own personal assets and your liability would therefore be unlimited.
Second, a Spanish limited liability company requires minimal infrastructure. You’ll need a minimum of only one director and one shareholder to register your limited company in Spain. What’s more, these can be the same person, can be of any nationality and need not be a resident of Spain.
Third, Spanish official government notices regarding Spanish companies are all digitally archived and always available online. This allows for total transparency and easy access to any information you might require.
Here’s How to Go About It
The process of business registration in Spain is not too complicated. However, you will need to implement a number of formalities in the right order. The first step in setting up your limited company in Spain is checking your desired company name at the Mercantile Register. You can do this in person at the office of the Registry or via e-mail. The procedure takes only a few days. You’ll receive your answer by courier.
You’ll Need a Tax Identification Code
Then, you’ll need to apply for your tax identification code from the Delegacion Provincial de la Agencia Estatal de la Administracion Tributaria. In order to do this, you’ll need both the original and a photocopy of your NIE. You’ll get your new tax number almost immediately.
After you have obtained your tax code and the certificate from the Mercantile Register, you have to open a bank account. Then, you’ll need to deposit the minimum authorized share capital into the bank account. Once you’ve done that, you’ll need a bank certificate. This you will deliver to a notary as evidence.
Sign and Register the Deed of Incorporation
Next, arrange an appointment with a notary and arrive with all of your documents in hand. While you are with the notary, you will sign the deed of incorporation.
Once you have the original deed of incorporation from the notary, you now must go to the Local Government Tax Authority to register the deed. Then, within two months’ time, you must submit the certificate of name reservation, the certificate of capital deposit and the incorporation deeds to the Mercantile Registry.
The Mercantile Registry will issue a certificate of incorporation and announce the incorporation of your company in Spain by publication in the official journal of the Mercantile Registry.
Obtain Your Permanent Tax ID
The next thing you’ll need to do for your business registration is Spain is pay another visit to the tax office. Now, it’s time for you to obtain your permanent Corporate Tax Identification Number (CIF). Once that’s done, you’ll need to register your company’s employees. This you’ll do at the local general treasury of social security at the Tesoreria General de la Seguridad Social. Finally, you’ll need to obtain a municipal license, a process that can take up to 15 days.
Establish Your Mailing Address
All Spanish limited liability companies must have a registered office where they can receive official correspondence. This address may be either commercial or residential. Usually, it is usually the main location of the company’s business.
If your Spanish company has more than one place of business, you must declare all of the addresses on your tax forms.
Find a Professional to Help You
We have tried to provide you with a good level of detail in this article. However, there are a number of legal issues we simply haven’t room to address here. So, before you begin the process to obtain a business registration in Spain, be sure to contact a legal professional. That person will help you navigate the system and avoid mistakes throughout the process.