Set Up your Company in Spain

As opposed to some other EU countries, creating your own company in Spain is no easy task.

Introduction

Buckle up for the journey of establishing your company in Spain! While the process may seem daunting, we’re here to guide you through it. Join us as we navigate the 10 essential steps involved in setting up a business entity in Spain. From obtaining tax identification numbers to registering with the trade authorities, each step is crucial for ensuring a smooth transition into the Spanish business landscape. Let’s dive in and simplify the path to realizing your entrepreneurial dreams in Spain!


 

What to know

You’ll need determination and perseverance and, ideally, some professional help. The process for setting up a company can be broken down into simple steps, however, it is advisable to be assisted by a professional advisor to avoid delays and pitfalls. Let us walk you through a list of 10 steps to give you a feeling for the process involved:

  • 1. Get Shareholder Tax Identification Numbers

To perform any legal or economic transaction in Spain, you or your company will need to have a tax identification number. This can be a Número de Identidad de Extranjero (NIE) or a Número de Identificación Fiscal (NIF, or CIF (old name)). The process of getting a NIE or NIF might take some time depending on country of origin, layers and number of shareholders involved, translations and legalizations etc. so plan ahead and start the process on time. Our relocation team is there to assist you during this process.

  • 2. Define type of Company and Governance

It’s important to decide what type of company fits best to your objectives: A private limited company, a public limited company, a general partnership, a non-profit foundation, a branch office, or a subsidiary. A second important aspect to consider is who the shareholders will be and how the company is going to be governed: A sole director, joint directors, a board of directors, with either full, shared, or limited powers. Our corporate lawyers can advise you on the best options for your case.

  • 3. Decide on Company Name and Brands

For the official company name, you will need to prepare a list of five possible names to be registered in the Registro Mercantil Central, which will check the availability of those names. This typically takes a couple of days. Also, if you are launching a product or service under a different brand name, you should consider registering a trademark in Spain or in the European Union and reserve the corresponding domains for websites and social media platforms.

  • 4. Prepare Company Statutes, Bylaws and Deed of Incorporation.

The deed of incorporation defines for example the company’s location, its activities, the date of start of operations, the capital, its shareholders, and the directors administrating the company. In the statutes things like the government of the company, its decision-making processes, rules for share transfers and profit distribution will be defined. If your needs fall within the standard statutes defined by the Spanish administration, a fast-track process is available through authorized entities called PAE that have access to the online CIRCE platform. We are accredited as a PAE center and can handle both elaborate and fast-track constitution.

  • 5. Open a Bank Account

Once you establish your company in Spain, you will also need to open a bank account for the company in a Spanish bank. Once you have a registered name for your company you can do this, but to activate the account the company will have to be registered in the trade register first. Note that the Spanish tax agency and social security services only work with certain banks, you can find more details here. The process of opening a bank account can be slow and bureaucratic, but we have contacts with most recognized Spanish banks that can speed up the process.

  • 6. Sign before Public Notary

Once we have elaborated the company statutes and deed of incorporation, the constitution of the company will be signed before a public notary. Necessary documentation to present includes identification, NIE or NIF of all shareholders and directors, company bank account certificate, name certificate from the trade register, and company statutes and bylaws. We will arrange an appointment with a trusted English-speaking notary and will prepare all documentation. All founding members of the company must be physically present at the to sign the deed of incorporation or can be done through a power of attorney.

  • 7. Obtain the Company’s Fiscal Identification Number (NIF)

Now that the Deed of Incorporation has been signed, we will request a fiscal identification number for the company from the Spanish tax agency (AEAT). Once this has been assigned, in a matter of days you can start your activity. In Spain, the fiscal identification number also serves as company identification number and VAT number at the same time.

  • 8. Inscription Trade Register

At the same time, we will present the Deed of Incorporation to the Trade Register for inscription, which takes approximately three weeks. The incorporation of the company will also be published in the BORME (official public bulletin board). Once the registration has been done, the company’s bank account can be activated and a digital certificate for the company can be requested. This certificate is necessary as all interaction with the Spanish authorities is digital and online.

  • 9. Registration Tax Agency Census

Finally, to start the company’s economic activity, the start date of operations, the classification of activities and company locations need to be communicated the Spanish tax agency, as well as the different fiscal obligations that are to be fulfilled. The start date communicated marks the start of the requirement to keep the company’s activities in a recognized accounting system and to comply with the monthly, quarterly, and annual tax declarations. Registration for digital communication with the tax agency is obligatory and to be established through the DEHU system. We provide a 360º service and assure legal, fiscal, and administrative compliance.

  • 10. Corporate Social Security Number

If you are hiring employees, you will have to request an employer social security number (CCC) from the social security services (TGSS). The assignment of this number takes a couple of days and needs to be obtained before hiring any staff. All employees need to have a residence and work permit and a Spanish social security number (NAF) before they can be employed. Our immigration lawyers can provide support with obtaining a Visa, Residence or Work permits.

Now you know what is needed to establish a limited company in Spain. It may feel like a complicated process, but with the proper guidance and help of our experienced lawyers we can arrange it quickly and smoothly. Entrusting us with your legal and administrative matters allows you to focus your attention on your business without distractions.

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The information contained herein is of a general nature, and subject to changes. Applicability to your specific situation should be determined through consultation with our tax or legal advisors.