Requirements for setting up a company in Spain
The requirements for setting up a company in Spain involve financial, fiscal and documentary aspects. It is important to know the complete process for setting up a company, regardless of its legal form, as this process ensures the activity of the company itself, both in the short and long term.
Below, we will analyse the requirements for setting up a company in our country, and the current legislation regarding the start-up of a business.
The basic requirements for setting up a company
Setting up a company in Spain is a process that involves complying with a number of legal and administrative requirements. The following are the most significant steps and requirements for setting up a company in Spain.
- Choosing the legal form: It is essential to choose the legal form that best suits the type of business. Options include Sociedad Limitada (S.L.), Sociedad Anónima (S.A.) or autónomo, among others.
- Certificate of company name: Before incorporating the company, a certificate must be requested from the Central Mercantile Register to ensure that the desired company name is not already in use.
- Bank account and share capital: In order to incorporate an S.L., it is necessary to provide a minimum share capital of €3,000, this amount varies depending on the legal form of the company. This investment must be deposited in a bank account created specifically for the company, and the bank will provide a certificate of deposit as proof. (from 2023 is not necessary to deposit 3.000€ in the bank account but the liability of the share holders still exist)
- Drafting and signing of the articles of association: The articles of association are the fundamental document governing the operation of the company. They must be drafted and subsequently signed before a notary. The notary certifies the public deed of incorporation of the company.
- Provincial Mercantile Register: Once the public deed has been obtained, the company must be registered in the Mercantile Register of the corresponding province.
- Obtaining the NIF (Tax Identification Number): It is essential to obtain the provisional NIF from the Tax Agency. Subsequently, once the company is registered, it will become definitive.
- Census declaration and registration with the IAE (Tax on Economic Activities): Before starting the activity, the census declaration must be filed with the Tax Agency. Although SMEs are exempt from IAE for the first two years, it is compulsory to declare the registration.
- Social Security registration: If the company is going to have employees, including administrators in some cases, it is necessary to register the company with the General Treasury of the Social Security and obtain the contribution account code.
- Registration of employees: Before employees start work, they must be registered in the Social Security system.
- Licences and permits: Depending on the activity of the company, specific licences or permits may be required. For example, an opening and activity licence is essential for many businesses that open to the public.
- Official books and accounts: The company is obliged to keep orderly accounts appropriate to its activity. In addition, certain books must be legalised in the Commercial Register.
- Data protection: If the company is going to process personal data, it must comply with current data protection regulations, registering the files and adopting appropriate security measures.
Setting up a company in Spain can be a complex process and it is crucial to ensure that you comply with all legal and tax obligations from the outset.
Types of companies in Spain
The benefits of having specialists when setting up a company
Having an advisor when setting up a company offers multiple advantages, which can make the difference between a successful business start-up and the possibility of generating problems with a complex solution in the future.
- Specialised knowledge: An advisor has training and experience that guarantees in-depth knowledge of the procedures, laws and regulations applicable to business start-ups. This reduces the risk of errors and omissions.
- Time saving: Setting up a company involves a series of procedures that can be complex. An advisor can streamline these processes, allowing the entrepreneur to focus on other essential areas of the business.
- Tax optimisation: An advisor can offer advice on the most appropriate legal and tax structure for the business, seeking an efficient and legally compliant tax burden.
- Prevention of legal problems: By having an expert, the chances of facing penalties, fines or legal problems due to ignorance or errors in documentation are minimised.
- Objective perspective: An advisor brings an external and objective view, providing recommendations based on industry experience and best practices.
- Security and confidence: Knowing that you have the backing of a professional offers a sense of security and confidence, allowing the entrepreneur to start his project with a solid and well-structured base.
How long does it take to set up a company in Spain?
Incorporating a company in Spain can vary in time depending on various factors, such as the legal form chosen or the speed with which documents are obtained.
Generally speaking, if you opt for a Sociedad Limitada (S.L.), the process usually takes between 10 and 15 working days, taking into account all the formalities from obtaining the company name certificate to the final registration at the Mercantile Registry. However, with the help of an advisor or by using telematic management services, this period can be reduced. It is essential to consider that external factors or complications in the documentation can lengthen this period.
At Asesoria Orihuela Costa we offer you the experience of a team specialised in corporate incorporation processes. If you are going to start your business project, contact our office and count on the best support.
