Company Formation in Spain for Foreigners
Setting up a Sociedad Limitada in Spain as a foreign shareholder is more accessible than most expect — €1 minimum capital, no residency requirement, and a reduced 15% corporate tax rate for new companies. The paperwork sequence, however, has a specific order that trips up first-time founders.
€1
minimum share capital for a standard SL since the 2022 reform
15%
reduced corporate tax rate for the first 2 profitable tax periods
No residency
required for foreign shareholders or directors
7 steps
from NIE to definitive CIF registration
The incorporation sequence
1. NIE for each shareholder/director
The Número de Identificación de Extranjero is required before any foreigner can be listed as a shareholder or sign before a notary — apply early, as processing times vary by consulate or Spanish police station.
2. Company name certificate
Request a certificación negativa de denominación social from the Registro Mercantil Central confirming your chosen company name is available.
3. Bank deposit of share capital
Open a Spanish account, deposit the share capital, and obtain the bank certificate needed for the notary appointment.
4. Notarized incorporation deed
Sign the escritura de constitución before a Spanish notary — non-resident founders can often do this via power of attorney.
5. Provisional CIF
Obtain the company's provisional tax ID (CIF) from the Agencia Tributaria immediately after signing.
6. Mercantile Registry filing
Register the incorporation deed at the Registro Mercantil of the province where the company is domiciled.
7. Definitive CIF
Once registration completes, the provisional CIF is converted to the definitive tax ID, and the company can begin operating fully.
Frequently asked questions
Do I need to be a Spanish resident to set up a company in Spain?
No. Foreign nationals, resident or not, can be shareholders and directors of a Spanish Sociedad Limitada (SL) — the most common structure for small and medium businesses, roughly equivalent to a UK Ltd or a US LLC. What you do need is a NIE (Número de Identificación de Extranjero), the Spanish tax ID number for foreigners, which is required before you can be listed as a shareholder or sign incorporation documents before a notary.
What is the minimum share capital to form a Sociedad Limitada?
The minimum share capital for an SL is €1 (following the 2022 reform to the Ley de Sociedades de Capital, which removed the previous €3,000 minimum for standard SLs), though in practice most incorporations still use a more substantial capital figure for credibility with banks and suppliers. Companies formed with less than €3,000 in capital face additional legal restrictions (mandatory annual reserve of 20% of profits until reaching €3,000, and enhanced liability for shareholders in case of liquidation) under the "SL de formación sucesiva" regime.
What are the main steps to incorporate a company in Spain as a foreigner?
The core steps are: (1) obtain a NIE for each foreign shareholder/director; (2) request a company name certificate (certificación negativa de denominación social) from the Registro Mercantil Central; (3) open a Spanish bank account and deposit the share capital, obtaining a bank certificate; (4) sign the incorporation deed (escritura de constitución) before a Spanish notary; (5) obtain the provisional CIF (tax ID for the company) from the Agencia Tributaria; (6) register the company at the Registro Mercantil (Mercantile Registry) of the relevant province; (7) obtain the definitive CIF once registration is complete. Non-resident directors can often complete several of these steps via power of attorney without traveling to Spain.
What corporate tax rate applies to a Spanish SL owned by foreigners?
The standard Corporate Income Tax (Impuesto sobre Sociedades, Ley 27/2014) rate is 25%. Newly created companies benefit from a reduced 15% rate for the first tax period with a positive tax base and the following one, under art. 29.1 of the Ley del Impuesto sobre Sociedades — this reduced rate applies regardless of the nationality or residency of the shareholders. Certain small companies (facturación under €1 million) may also qualify for additional reduced-rate regimes depending on the specific tax year's rules.
Does a non-resident director need a work permit or visa to run a Spanish company?
Being a director or shareholder of a Spanish company does not by itself require a Spanish residency or work permit if the director does not physically work from Spain. However, a non-EU foreigner who intends to live in Spain and actively manage the business day-to-day will typically need to apply for a self-employment/entrepreneur visa or residency authorization tied to the business activity (e.g., the Ley de Emprendedores 14/2013 entrepreneur visa route), which has its own investment and business-plan requirements distinct from the company formation process itself.
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