Spain - SL Company Incorporations

Company Type	Time to Incorporate	Cost
SL	2 weeks	£1740

 

The standard Spanish Private Limited Company is the SL, the Sociedad Limitada and is very similar to the private limited company in other EU countries.

The registered office will initially be in Madrid, and is easily changed.

The company formation procedure normally takes two weeks and as an alternative; we can supply you with a ready made company

Incorporation procedure for a Spanish SL - Sociedad Limitada

• Performing a company name check and approval
• Registration of your company name: we apply for a certificate issued by the Mercantile Register, confirming that the name is reserved for you
• All directors and shareholders will require a Spanish fiscal identity number and we can obtain this number for you, through a Power of Attorney
• Depositing the share capital with a Spanish bank to enable them to issue a certificate of deposit.
• Drafting of Articles of Incorporation
• Holding of the incorporator's meeting before the Notary Public
• Drawing up of the notarized deed of incorporation
• Filing of incorporation documents with the Mercantile Registry
• Delivery of notarised Certificate of Incorporation and Articles of Incorporation
• We apply for the provisional tax number after the statutes are signed
• We lodge an agreement to incorporate the company with the tax authorities
• We obtain notarial authentication of the statutes and the constitution deed - the statues are signed by the shareholders and the directors in front of a notary
• A 1% share capital tax is paid at the tax office of the Region (Comunidad Autónoma)
• The company statutes are submitted to the Mercantile Register
• An announcement, showing the details of incorporation is placed in the BORME newspaper, the bulletin for the Mercantile Register

The Company Statutes

The company statutes are signed by the directors and shareholders before a notary and this can be done with a Power of Attorney if the shareholders or directors cannot be present.

We inform the notary of

• The Registered Office in Madrid
• The objects of the company
• The directors of the company
• The shareholders
• The share capital

We attach to the deed

• Company Name clearance certificate
• Bank Deposit Certificate or Provisional CIF number documentation
• NIE certificates for the Directors

The notarial appointment can be arranged without notice with our Madrid notary and can be completed with a Power of Attorney if required.

Company Name Registration

We apply for a company name certificate from the Mercantile Register, confirming that your company name is acceptable and not already registered. This certificate for company name clearance is important as it is given to the notary, and a copy is also given to your bankers and the tax authorities. 

Company Directors

Only one director is required and can be of any nationality and who does not need to be a Spanish resident, is required for your SL company

Shareholders

Only one shareholder is required, who can also be the sole director

The shareholder can be of any nationality and nominee shareholders can be provided.

The share capital is €3000 and the shares can be issued for cash or through a donation of assets.

There is no public register of shareholders of a Spanish company, whilst the initial shareholders are stated in the deed of incorporation, any subsequent changes of shareholders are by a notarial deed, which is not filed at the Mercantile Register.

The shares of a Spanish limited company can be transferred at any time and are sold through signing an agreement in front of a Notary.

Share Capital - Bank Account

There are two methods to put the funds into the company for the first issue of shares.

• with a bank account - We take the company name clearance certificate to the bank to open the account, then the €3000 capital is credited and we then obtain a deposit certificate.
• or we inform the tax authorities of a donation of assets to capitalise your company.

We remit to the tax office of the region the 1% tax for the initial issue of share capital.

The Company Registry - Mercantile Register - Registro Mercantil

We present the following documents to the Mercantile Register.

• The company statutes
• The company name clearance certificate
• The receipt for payment of the tax on the share capital
• The tax authority form stating the provisional tax number of the company

The Mercantile Register allots an identification number to the company, and arranges for the details of the company to be advertised nationally.

Activating your company to trade

Your company gets a tax CIF number at the time of incorporation, often the same day that the company statutes are signed with the notary.

The company is then active and can start trading from that moment.

This CIF number is also your VAT number. If the company is to trade, we need to do the following:

• Register for Economic Activity
• Register to employ people with the Social Security agency

Register to pay the Economic Activity Tax

The company has to register for a small tax to the local municipal authority and the information that we generally present when registering includes:

• A plan showing the layout of the place of work
• A map showing where the place of work is
• A valuation of the building and the equipment
• A written description of the activities taking place

Register with the Social Security

This is done at the social security office closest to the registered office of the company, the company then selects a health company (mutua) which looks after the employees in the event of accidents at work.

VAT Registration

We apply for a company name certificate from the Mercantile Register, confirming that your company name is acceptable and not already registered. This certificate for company name clearance is important as it is given to the notary, and a copy is also given to your bankers and the tax authorities. 

We submit your company name to the Mercantile Registry and obtain a Company Name Certificate.

We then apply for a provisional company tax identification code (código de identificación fiscal/CIF) and register for VAT (IVA). Your CIF will act as your VAT number and allows you to open a bank account in the company’s name and deposit the required amount of capital, which you must do before incorporation can take place. You, or your accountant, can apply for a CIF at the tax office. To apply for your CIF number, you must provide the following details: the name of your company (and the Negative Name Certificate from the Mercantile Registry), the registered address of the company, and identification in the form of your passport or residence permit. The tax office will then issue you with a certificate called an Identificación Fiscal that has your CIF number on it.

Once you have a CIF, you can open a bank account in the company’s name and deposit the required amount of capital. The certificate from the tax office states your company name with the addition of the words en constitución, which means that your company is in the process of being incorporated. You will receive another certificate ( Certificado del Desembolso Efectuado) proving that you’ve paid this amount into your business account. The certificate is also required to obtain your permanent CIF just before you start trading.

The company constitution, or deed of incorporation, can then be prepared and signed before a notary

• The Company Name Certificate from the Mercantile Registry
• The company’s provisional CIF
• The certificate showing the deposited share capital
• Documents to prove the identity of the founding partners.

The notario will also need to see the company bylaws, which should include such details as your corporate name and business purpose, the business address, your capital and the number of shareholders. You will also have to state whether any directors or administrators will be paid and, if so, what the payment arrangements will be. Finally, you must detail your corporate fiscal year, which can be no longer than one calendar year. The fiscal year is from 1st January to 31st December, and it’s simpler if your company’s fiscal year is the same. After the signing, your company bank account can be activated and the authorised signatories registered with the bank.

We pay the 1 per cent tax on the share capital at your local regional tax office.

Then we register your company with the Mercantile Registry by lodging the notarial deeds and forms showing name clearance, the CIF number and payment of the share capital tax. 

The final step is to obtain your permanent CIF from the tax office and register your company for the ‘tax on economic activities’ ( Impuesto sobre Actividades Economicas – IAE) in order to be issued with a business licence. For this you will need the certificate showing your provisional CIF, your deed of incorporation and a photocopy of your registration with the Mercantile Registry.

Sociedad Limitada SL

We incorporate your company through a deed with a public notary, which we then register with the Mercantile Registry. Your company is now incorporated.

We include the following in the deed of incorporation: 

• The shareholders.
• The election to incorporate a Sociedad Limitada SL.
• The contributions made by each shareholder and the number of shares.
• The articles of association of the company.
• The manner in which the management of the company is to be organised.
• The directors of the company.

The company's articles of association we draft include:

• The name of your company.
• Incorporation formalised through a public deed and its subsequent registration in the Mercantile Registry.
• The type of company, Sociedad Limitada or the abbreviation S.L.
• The company must establish its registered office at the address where it carries out its actual administration and management, or at the location of its principle establishment or operation.
• The share capital may not be less than 3,000 euros. It must be fully subscribed and paid up at the time of incorporation.
• Accessory contributions, separate from the contributions of capital, can be established in the articles of association on a compulsory basis for all or only some of the participation unit holders, indicating the specific content of such contributions and whether they are to be made gratuitously or for remuneration.  If the accessory contributions are remunerated, the articles of association must determine the remuneration to be received by the participation unit holders concerned.
• The management of the company can be entrusted to a sole director, to several directors who act jointly and severally or as a body, or to a Board of Directors.
• Unless otherwise stipulated in the articles of association, a person does not have to be a shareholder in order to be appointed as a director.
• The directors will hold their offices for the term stipulated in the articles of association and may be removed from office at any time as a result of a resolution by the General Meeting.

Incorporating a Spanish SL Company with a Donation of Assets

Two methods of incorporation are allowed, both requiring the subscription of the share capital of €3000 in cash or with a donation of assets worth the value to be subscribed.

The procedure is as follows:

• You sign an agreement to start your Spanish company as the initial shareholder. We then prepare various documents , which comply with the tax authorities guidelines.
• We will draft your board minutes for the directors signature stating it is your intention to incorporate a Spanish company. These will be notarised and apostilled in your country and translated.

We then obtain from the tax office your provisional CIF number with:

• The Acuerdo de Voluntades statement
• The board minute duly apostilled
• The Spanish company name clearance certificate
• The translations prepared by ourselves
• These documents are then presented to the notary who will issue the Notarial deed.

The Notarial deed will show the list of your assets which will be used for the capital of your company, such as stock, computers, furniture to the value of the capital.

The Fiscal Identity Number for your Spanish company

To be appointed as a director or shareholder you will require an identification number (NIE number), and for a company shareholder it is a CIF number.

• We can obtain your fiscal identity number (NIE) for you, through a Power of Attorney
• We can obtain a company tax number CIF for you, by obtaining legalised documents of your company

All directors or shareholders will need Spanish identification numbers to sign the company statutes with the Notary.