Forming A Company In Spain: The Complete Guide

Published on September 29, 2025 and written by Cyril Jarnias

Spain, with its dynamic economy and strategic position in Europe, is increasingly attracting foreign entrepreneurs looking to establish their business there. This article will guide you through the key steps of setting up a company in Spain, covering the essential legal, tax, and practical aspects to ensure your entrepreneurial project succeeds in this Mediterranean country.

Why Spain is a Land of Opportunity for Entrepreneurs

Spain offers numerous advantages for entrepreneurs looking to set up a company:

A dynamic and diverse market: With nearly 47 million inhabitants and a growing economy, Spain represents an attractive domestic market. Additionally, its geographical position makes it an ideal gateway to Europe, North Africa, and Latin America.

A business-friendly environment: The Spanish government has implemented various measures to simplify business creation and attract foreign investment. Administrative procedures have been streamlined, and numerous tax incentives are available.

Recognized quality of life: Spain is renowned for its pleasant climate, cuisine, and rich cultural heritage. These assets help attract talent from around the world and provide a fulfilling living environment for entrepreneurs.

Modern infrastructure: The country boasts excellent transportation and telecommunications infrastructure, facilitating both domestic and international trade.

The Most Suitable Legal Structures for Your Project

Several legal forms are available for setting up a company in Spain. Here are the most common:

Sociedad Limitada (S.L.): Equivalent to the French SARL, this is the most common form for SMEs. It offers limited liability to partners and requires a minimum share capital of €3,000.

Sociedad Anónima (S.A.): Similar to the French société anonyme, it is suitable for large companies and requires a minimum share capital of €60,000.

Empresario Individual (Autónomo): Sole proprietorship status, ideal for small-scale activities. The entrepreneur has unlimited liability.

Sucursal: Branch of a foreign company, without its own legal personality.

Sociedad Profesional: Structure dedicated to regulated liberal professions.

The choice of legal structure will depend on your activity, objectives, and personal situation. It is recommended to consult an expert to determine the most suitable form for your project.

An Attractive Tax Regime for Companies

Spain offers a competitive tax system for companies:

Corporate tax: The general rate is 25%, but reduced rates exist for certain categories of companies: – 15% for new companies during their first two profitable years – 10% for small companies (turnover below €10 million)

VAT: The standard rate is 21%, with reduced rates of 10% and 4% for certain goods and services.

Tax incentives: Spain offers numerous tax deductions, particularly for R&D, technological innovation, and business internationalization.

Tax treaties: Spain has signed double taxation treaties with many countries, facilitating international exchanges.

Setting Up Your Company in Spain: A 7-Step Process

Here are the main steps to set up your company in Spain:

1. Obtain a NIE (Foreigner Identification Number): Essential for any foreigner wishing to conduct economic activity in Spain.

2. Choose and reserve the company name: With the Central Commercial Registry (Registro Mercantil Central).

3. Open a professional bank account: To deposit the share capital.

4. Draft the company bylaws: Defining the corporate purpose, capital, share distribution, etc.

5. Sign the deed of incorporation before a notary: The notary will verify the legality of the documents and proceed with registration.

6. Obtain the NIF (Tax Identification Number): From the Spanish tax administration.

7. Register the company with the Commercial Registry: To grant it legal personality.

These steps can typically be completed in 2 to 4 weeks on average. It is recommended to seek assistance from a lawyer or manager to ensure compliance at each stage.

Spain vs. Other Offshore Jurisdictions: Strengths and Specificities

Compared to other attractive offshore jurisdictions, Spain offers several advantages:

Political and economic stability: As a member of the European Union and the eurozone, Spain provides a stable and predictable legal and economic framework.

Reputation: Unlike some tax havens, Spain enjoys a good international reputation, facilitating business relationships.

Access to the European market: A Spanish company benefits from free access to the European single market.

Quality of life: Spain stands out for its high quality of life, an asset for attracting international talent.

Moderate taxation: While tax rates are higher than in some tax havens, they remain competitive on a European scale.

Understanding the Social Obligations of Spanish Companies

Spanish companies are subject to various social obligations:

Social security: The employer must pay social security contributions, representing approximately 30% of the employee’s gross salary.

Minimum wage: The interprofessional minimum wage (SMI) is set at €1,080 gross per month in 2023.

Paid leave: Employees are entitled to a minimum of 30 calendar days of paid leave per year.

Working hours: The legal working week is 40 hours.

Employee representation: Companies with more than 50 employees must establish a works council.

It is crucial to understand these obligations to avoid any labor disputes and ensure smooth management of your company.

Opening a Professional Bank Account: Key Steps

Opening a professional bank account is an important step in setting up your company in Spain. Here is the procedure to follow:

1. Choose a bank: Compare offers from major Spanish and international banks present in Spain.

2. Prepare the necessary documents: – NIE of partners and directors – Passports – Proof of address – Company bylaws – Notarized deed of incorporation – Company NIF

3. Schedule an appointment with the bank: Physical presence is generally required to open the account.

4. Sign the account opening contract: Read the terms carefully, especially regarding banking fees.

5. Make an initial deposit: Some banks require a minimum deposit to activate the account.

6. Obtain payment methods: Bank cards, checkbooks, access to online banking.

The Most Promising Business Sectors in Spain

Spain offers opportunities in many sectors, including:

Tourism and hospitality: Spain is one of the world’s top tourist destinations, offering numerous opportunities in accommodation, catering, and tourism services.

Information technology: The Spanish tech sector is experiencing rapid growth, particularly in artificial intelligence, big data, and cybersecurity.

Renewable energy: Spain is a European leader in this sector, with strong potential in wind and solar power.

Agri-food: The Spanish agri-food industry is renowned for its quality and innovation.

E-commerce and logistics: The growth of online commerce opens many opportunities in distribution and logistics.

Health and biotechnology: The health sector is expanding rapidly, particularly in telemedicine and biotechnology.

Recruiting in Spain: Keys to Building Your Team

To recruit effectively in Spain, follow these tips:

Understand the local labor market: Familiarize yourself with recruitment practices and salary expectations in the sector.

Use the right recruitment channels: Job sites (Infojobs, LinkedIn), specialized recruitment agencies, professional networks.

Master the types of contracts: Permanent (contrato indefinido), temporary (contrato temporal), training contract, etc.

Comply with labor legislation: Probation period, dismissal procedures, collective agreements.

Offer attractive benefits: Beyond salary, provide benefits valued in Spain (private health insurance, continuous training, flexible hours).

Promote cultural integration: Be mindful of cultural differences and promote good integration of foreign employees.

Conclusion: Spain, a Strategic Choice for Your Business

Setting up a company in Spain represents a strategic opportunity for entrepreneurs looking to establish themselves in the European market. With its dynamic economy, stable legal framework, and recognized quality of life, Spain offers an environment conducive to business development.

Although the company creation process involves several steps, careful preparation and professional support will enable you to successfully carry out your project. By understanding the specifics of the Spanish market and leveraging the country’s many assets, you can position your company on the path to success.

Remember that each entrepreneurial project is unique. Therefore, it is essential to adapt this general information to your particular situation and seek advice from local experts to optimize your chances of success in the Spanish market.