This section is designed to help you understand why you need a Limited Company in Spain.
The main reason for opening a Limited Company in Spain as in any country is to protect the personal interests of its Directors but also for flexibility is the main characteristic of this business structure, since the shareholders are free to make their own rules inside the company. A Spanish SL usually is used for small and medium sized companies. Law 2/1995 on “Sociedades de Responsabilidad Limitada” (Limited Liability Companies) simplifies the structure of the limited liability company (S.L.).
What is the minimum Share Capital required for an SL? The minimum is 3.005,06 € to be deposited into a current account in the name of the company. Or alternatively the directors can introduce assets equivalent to that amount avoiding using cash.
Can I take this Capital out of the business at anytime or do I have to leave it in the bank account? No, once we have received your Stamped Deeds from the Registro Mercantil, you can withdraw the funds.
How often do we have to submitt accounting records? A quaterly return for IVA (purchase tax) and income and expenditure is required to be sent to the Hacienda by the 20th of the following month after the quarter end.
Why is it so expensive to establish a Limited Liability company in Spain? In Spain all documents of formation have to be incorporated into a Deed and signed by a Notary hence a large majority of the costs go to this provision but in addition company formation requires at least eight visits in person to various offices.
Can a foreign company be the sole shareholder? Yes. but the company may not be the director, the director has to be a person.
Does the company have a VAT number? The company will have a Spanish tax ID "CIF", which is the VAT number. You will have the tax ID the day you sign at the notary. With the tax ID, your Spanish company can do business anywhere. If the company will be exchanging frequent invoices with companies in the EU but outside Spain, then you may want to be listed in the EU VAT registry, VIES so you won't have to bill and be billed for IVA in your EU transactions.
Please feel free to email us with any questions that are not outlined above.
Tlf: +34 627 35 96 72, +34 627 130 734, +34 642 743 298, +638 326 712
OPEN 7 DAYS A WEEK 8AM - 20:00