Starting a business in a foreign country like Spain can make you nervous and think about a lot of things. However, this only seems to be the case because you are in the early stages and as soon as you can get a feel for the minimum requirements and major regulations, things will start to change. To have all the chances of success, it is important that you know everything about starting a business in Spain.
How to get a work visa in Spain?
Contrary to popular belief, starting a business in Spain doesn’t have to be a daunting process. If you have a clear idea of what to do, the journey will be easier.
EU citizens can easily set up a business in Spain. On the other hand, expatriates need a work permit to settle in the country and start a business. You must apply for a work visa at a Spanish consulate or embassy, in the self-employed or freelance category, providing the following documents:
- Proof of sufficient funding to finance your stay in the country.
- Proof of required skills and experience
- A complete business plan, if applicable
- Proof of contracts or company commissions
- Licenses and registrations required to perform work in Spain
- Details on your potential for job creation in Spain.
After obtaining your work and residence permit, you can then apply for a visa to travel to Spain. Note that work permits are valid for one year, after which you will need to renew them if you still meet the conditions.
What type of license or permit is required?
Another thing you should know is that before starting a business in Spain, all residents and non-resident foreigners must have a Tax Identification Number (NIE). Your NIE is important for financial transactions in Spain.
The tax identification number of foreigners, which is the NIE, differs from that of citizens, who are assigned a TIN rather than a NIE number. You can apply for a NIE at a processing office for foreign citizens (Oficina de Extranjeros) at any Spanish national police station (comisaria).
How to register your business?
The very first step in setting up a business in Spain is to obtain a certificate that the name of the business you intend to use has not already been taken. This document is called an unnamed certificate of coincidence and can be obtained from the Commercial Register (RMC).
You can apply for it directly on the RMC website. After receiving a response from RMC by mail, you can then proceed to create a commercial bank account in Spain. During this procedure, you will need to provide your tax code and your certificate of non-coincidence.
Commercial accounts in Spain require a minimum share capital of € 3,000 which you will open with the account. Note that proof of payment can be obtained from the bank. You will need it later.
Registration of the deed of incorporation
The next step is to request the deed of incorporation of your company. The deed of incorporation is a document that describes the main details of the company.
All you need to do is make an appointment with a notary to sign the deed of incorporation through the official notaries website. You must also submit the following documents:
- Tax form 036
- Commercial register certificate
- Your NIE
- Proof that your account is sufficiently funded, issued by the bank.
This can take between one and three days, depending on the appointment set by the notary.
Tax and social security considerations
To successfully run your business in Spain, you need to be aware of certain tax and social security considerations. First of all, the standard working schedule in Spain is 40 hours per week, and every employee contract must be registered with social security before it resumes.
Additionally, employees must be paid monthly, with a minimum wage of at least € 1,108 from 2020. Employers must also deduct income tax from employees’ wages accordingly.