Just the fact of opening a company can be overwhelming if you do not have knowledge and professional advice to carry out all the steps and bureaucracy correctly. Much more if it is about starting a business in Spain as a foreigner. In this article we will delve into the whole process, requirements and formalities to set up a company in our country being a foreigner successfully.
Can I set up a company in Spain as a foreigner?
Yes, you can open a company in Spain being a foreigner. However, the formalities can be more dense if in addition to creating the business, you intend to work in it. In this case, it is necessary to have a residence and self-employment permit.
Requirements to create a company in Spain as a non-EU foreigner
In the case of not being a citizen of one of the member states of the European Union, the following conditions must be met:
No criminal record
The interested party may not have any of the criminal records listed in the Spanish code and neither in any of the countries in which he/she has resided throughout his/her life.
To be of legal age
To start the procedures to open a business in Spain requires that the person is over 18 years of age.
Not to be in an irregular situation in the country
The interested party cannot appear as rejectable in Spain or in any of the territories that have agreements with the country. Neither can be outside the period of commitment of non-return after returning voluntarily to their country of origin and may not have the entry to Spain prohibited.
To have accredited professional qualifications for the exercise of the specific activity
To start a business in Spain as a foreigner you must have accredited experience for the exercise of the activity, an accredited professional qualification or professional registration if necessary.
<H3>To justify the capacity to cover the foreseen investment necessary for the start-up of the project.
It is necessary to provide a justification that it has the capacity to respond on the expected investment needed for the project and also contemplate if the company foresees the generation of new jobs in the country.
Provide proof of financial capacity to support the project
It is also necessary to demonstrate that it has the economic capacity to maintain the company and cover the expenses that are deducted from the development of its activity.
Comply with the current regulations for the opening and start-up of the business
Of course, in order to formalize the procedures to create a company in Spain, it is essential to comply with the current regulations in Spain on the opening and start-up of a business.
Requirements for setting up a company in Spain if you are a European citizen
Thanks to the agreements established between the member countries of the European Union, the process of opening a business in Spain as a European resident is much simpler:
Get the NIE number
The first step is to obtain the Foreigner Identification Number (NIE), the most important document to operate freely in Spain and which allows you to open a bank account, identify yourself for tax purposes, etc.
This procedure can be done from the Spanish consulate in the country of origin or requested from Spain at a police office. The term to obtain it can vary between 3 and 5 working days.
Afterwards, it is necessary to go to the Mercantile Registry and make a list with 3 possible names for the company. Once the final name is validated by the Commercial Registry, a certificate is issued.
Open a bank account for your company
The next step is to open a bank account for the new company in the entity chosen by the interested party. Depending on the corporate structure, the initial contribution in this bank account will be one or another.
For example, in case of establishing a Limited Company, 3,000 euros must be contributed. After this contribution, a bank certificate is generated which must be presented before a notary on the day of the incorporation of the company.
Defining the shareholders of the company and partners agreement.
At this point it must be agreed who will be the shareholders of the company and who will assume the position of director in addition to formalizing the partners’ agreement, where each shareholder is listed with its percentage of participation.
This part of the process is one of the most important, since it is necessary to contemplate and foresee the possible events that may occur during the life of the company in order to avoid problems in the future.
Going to the notary to sign the public deed.
With all the above formalities completed, it is time to go to the notary to sign the public deed. Here it is essential to present the NIE, the bank certificate and the certificate from the Mercantile Register.
The notary will officially register the company in the Mercantile Register.
Apply for the CIF (company tax identification number).
The new company must have an identification number for the tax authorities, the CIF. To do so, the corresponding form must be downloaded and filled out from the Tax Agency’s website and an appointment must be made to present it together with the NIE.
Social Security registration.
Finally, it is necessary to go to a Social Security office to register the new company. In this step it is necessary to submit the form 036 or 037, the NIE, passport and IRPF form.
What type of companies and societies exist in Spain?
In Spain there are different legal structures to incorporate a company and they are described in the Commercial Code:
Sole proprietorship.
The sole proprietorship does not require an initial investment and is the best option when it is a small company. In this typology there is no distinction between personal assets and business assets, so the owner is fully liable for any debt that the company has, i.e., it is unlimited liability.
Limited Company
The Sociedad Limitada is the most chosen option in Spain. It requires an initial investment of 3,000 euros and the owner of the company would be liable for its debts only with this amount. A Sociedad Limitada pays corporate income tax (25% of profits) and has to file a VAT return. It is the most appropriate structure if you anticipate revenues in excess of €60,000 per year.
Public Limited Company
The Sociedad Anónima is the structure used by large companies trading in shares. It requires an initial investment of €60,000 to incorporate and allows for external financing.
Other common questions
Do I need to go to Spain in person to incorporate a company?
No. The procedures to set up a company in Spain can be carried out from the Spanish Consular Office in the country of residence.
After signing the deed of incorporation, is it possible to start operating the company?
The process of registering the company in the Mercantile Registry can take 3 weeks, however, from the same day that the incorporation of the company is signed before a notary, a provisional VAT number is granted with which you can start the activity.
Do I need to be a resident in Spain to operate my company?
In order to create a company in Spain and operate with it, it is necessary to become a legal resident in the country.
Summary
As you have seen, opening a company in Spain being a foreigner requires the achievement of some procedures that can be very tedious and confusing, especially if you are a person who does not master the language and have no administrative notions. If you want to create a company in Spain and you want to do it with the company and the advice of an expert lawyer in the matter, contact us, we will simplify all the management and we will carry out the whole process for you with the best results.
