Miñana Beltran Tax & Legal, SLP - How to Set Up a Foreign Company in Spain: Complete Guide

Why choose Spain to expand your business?
Besides its strong connection to the European market and its appeal to foreign investment, Spain offers significant opportunities: a diversified economy and strategic access to European and Latin American markets.
However, like any expansion, setting up a company in a new country comes with challenges. From bureaucracy to local legislation and language barriers, opening a branch or subsidiary in Spain requires understanding the specific steps and requirements.
To help you succeed, this guide provides a step-by-step process to establish a foreign company in Spain quickly and securely.
Steps to Set Up a Company in Spain
1. Choose the Most Suitable Type of Company for Your Business
The first step is to select the appropriate legal structure for your company. There are several options, each with specific features:
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Limited Liability Company (SL): The most common structure for small and medium-sized businesses in Spain. Its popularity stems from its management flexibility and the limited liability of capital contributions.
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Public Limited Company (SA): Ideal for larger-scale projects or companies looking to attract investors and participate in the stock market. The SA requires higher share capital but offers a shareholder structure that facilitates expansion and investment entry.
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Other options: Less common structures, such as partnerships or cooperatives, may be suitable for very specific cases.
2. Apply for the NIE
The NIE is the Foreigner's Identification Number, required for all foreigners engaging in economic or social activities in Spain. If the company is established by individual foreign persons, they must first obtain an NIE. If the partner is a foreign legal entity, the administrator must also obtain an NIE.
3. Apply for a Non-Resident Company Tax ID (CIF)
If the partner of the new company is a legal entity, a CIF (Tax Identification Code) for non-resident companies must also be obtained.
4. Obtain a Negative Name Certificate from the Mercantile Registry
This document certifies that the proposed company name is not already registered by another business. It is an essential requirement for company registration in Spain.
5. Draft the Articles of Association and Deed of Incorporation
The Articles of Association are the internal rules of the company, which must comply with Spanish regulations. Legal advice is essential to draft them correctly and tailor them to your needs. Additionally, the company must be incorporated through a public deed before a notary to formalize its creation.
6. Submit Model 600 to the Tax Office
Model 600 is used for self-assessment of the Transfer Tax and Stamp Duty. Although the establishment of a company in Spain is exempt from this tax, filing this form is required to formalize the exemption.
7. Register the Company in the Mercantile Registry
After obtaining the public deed, the company must be registered in the Mercantile Registry. This step grants the company legal personality, enabling it to operate in Spain.
8. Obtain the CIF (Tax Identification Code)
The CIF is essential for the company to carry out fiscal activities in Spain, such as invoicing and fulfilling tax obligations.
9. Register with the Tax Office and Social Security
Tax registration is mandatory for all companies. Social Security registration is only necessary if the company plans to hire employees. Additionally, a census declaration must be submitted to define the company's tax details.
10. Open a Bank Account
A Spanish bank account is required to deposit the share capital. Documentation and requirements vary depending on the bank.
Costs of Setting Up a Company
Costs vary depending on the legal structure and other factors, such as share capital. Approximate expenses include:
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Notary fees for the public deed.
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Negative name certificate.
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Mercantile Registry registration.
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Legal and fiscal advice (optional but recommended).
Estimated range: For a Limited Liability Company, costs typically range between €700 and €2,000, excluding share capital.
Estimated Timeframes for Incorporation
The time required to establish a company depends on several factors:
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Standard timelines: From choosing the name to obtaining the CIF, the process may take several weeks.
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Influencing factors: The time of year, project complexity, and bank account setup can affect the timeline.
Engaging a specialized team to manage each step will save time and prevent unnecessary delays.
Legal and Fiscal Advice
Having the support of a specialized legal and fiscal team is crucial to ensure the success of your expansion in Spain.
At Miñana Beltrán Tax & Legal, our team of experts will guide you through all key areas, from regulatory compliance to resource management.
Ready to Establish Your Company in Spain?
Setting up a company in Spain offers numerous advantages but requires detailed planning and execution. With this guide, you now have a clear roadmap for the process, costs, and timelines.
Contact Miñana Beltrán and let us help you establish your company in Spain with confidence, knowing you're in expert hands.