How to create a Limited Liability Company in Spain?
Business Law
First of all, we must know that the Sociedad Limitada or S.L. is the most common type of company. In fact, there are more than one million S.L. in Spain, while there are only about 91,000 Corporations.
The Sociedad Limitada (S.L.) is a type of mercantile society in which the responsibility is limited to the contributed capital, that is to say that the capital will be integrated by the contributions of all the partners, divided in social participations, indivisible and cumulative. In Spain the minimum capital contribution is 3,000 € and these can be contributed in cash or in kind (assets/equity).
The constitution of the company is constituted following the following steps:
1)-Register the name of the company
The constitution of a mercantile society or of an entity inscribed in a Mercantile Registry, requires the previous obtaining in the CENTRAL COMMERCIAL REGISTRY of a favorable certification that collects the denominative expression with which the society is going to be identified as subject of rights and obligations in all its juridical relations.
Issued certification that the requested denomination is not registered, it will be registered in the name of the interested party or beneficiary of the same during the period of SIX MONTHS, counted from the date of issue.
2)-To make a monetary contribution of capital or in kind
With this contribution, the bank will provide a certificate of income so that it can be presented before a notary for the creation of the Limited Company. Until the current date, in 2024, all Limited Companies that were created in Spain had to contribute a minimum of 3,000 € of initial capital.
It will have to be drafted with the agreement of all the partners that will form the Limited Company. These statutes are a kind of rules with sums of wills that govern the rules of the company as well as the relations between the partners. The Statutes will be added later to the deed of constitution of the Company.
4)- Deed of incorporation of the limited company
It is an obligatory procedure and this must be done before a Notary Public.
Once the deed has been granted, the notary will inform the Registry of this fact, leaving the name of the company registered in it. The validity of the name certification is 6 months from the issuance of the negative certification of the company name.
As commented by the expert lawyers in company formation of Forcam Lawyers, in order to make this procedure effective, the following documentation must be provided: Articles of Association, negative certification of the name of the company in the Mercantile Registry, certification of the bank with the contribution justifying the capital contributed, DNI of the founding partners and in the case that the founding partner is a foreigner must provide declaration of investments abroad.
The notary can also obtain the NIF of the company, in case the interested party wants to do it on his own, it is enough to fill in form 036 and submit it either in person or online to the AEAT (Treasury).
5)- Registration in the tax on economic activities
The company must register with the AEAT. Even so, all companies are exempt from this tax, with the exception of those whose turnover is greater than one million euros. Therefore, the vast majority of companies will be exempt from this tax.
6)- Tax Return
To start the activity, it is obligatory to present to the AEAT form 036 and the previous IAE document if the company is not exempt from the Economic Activities Tax.
7)- Registration of the company in spain in the mercantile registry
The registration of the company in the Mercantile Registry must be carried out in the province where the activity is to be carried out and within two months of the execution of the deed of constitution of the company made before a Notary Public.
Once the registration has been carried out, the Registry will deliver the deed in which the volume, folio and sheet where the company has been registered will be recorded. These data must be compulsorily reflected in all commercial documentation issued by the company such as letters, invoices, delivery notes, etc..
After these formalities, the only thing missing is to have the definitive NIF, exchanging the provisional NIF that was given at the beginning in the Treasury, so that the Company will definitively acquire a NIF.
Lawyer assistance in Madrid
Lawyer assistance in Reus
The Sociedad Limitada (S.L.) is a type of mercantile society in which the responsibility is limited to the contributed capital, that is to say that the capital will be integrated by the contributions of all the partners, divided in social participations, indivisible and cumulative. In Spain the minimum capital contribution is 3,000 € and these can be contributed in cash or in kind (assets/equity).
The constitution of the company is constituted following the following steps:
1)-Register the name of the company
The constitution of a mercantile society or of an entity inscribed in a Mercantile Registry, requires the previous obtaining in the CENTRAL COMMERCIAL REGISTRY of a favorable certification that collects the denominative expression with which the society is going to be identified as subject of rights and obligations in all its juridical relations.
Issued certification that the requested denomination is not registered, it will be registered in the name of the interested party or beneficiary of the same during the period of SIX MONTHS, counted from the date of issue.
2)-To make a monetary contribution of capital or in kind
With this contribution, the bank will provide a certificate of income so that it can be presented before a notary for the creation of the Limited Company. Until the current date, in 2024, all Limited Companies that were created in Spain had to contribute a minimum of 3,000 € of initial capital.
However, from 2024, capital of 3,000 € is no longer an essential requirement for the constitution of a Limited Company.
And the Council of Ministers approved the Create and Grow Law that allows entrepreneurs to create a Society for less than the cost of a coffee.
This means that the requirement of having 3.000 euros to establish an SL is eliminated, introducing a symbolic value of 1 euro. However, any new entrepreneur who creates a Limited Company may create it with the capital they consider appropriate, whether 1 € or 3.000 €.
3)- Constitute articles of associationIt will have to be drafted with the agreement of all the partners that will form the Limited Company. These statutes are a kind of rules with sums of wills that govern the rules of the company as well as the relations between the partners. The Statutes will be added later to the deed of constitution of the Company.
4)- Deed of incorporation of the limited company
It is an obligatory procedure and this must be done before a Notary Public.
Once the deed has been granted, the notary will inform the Registry of this fact, leaving the name of the company registered in it. The validity of the name certification is 6 months from the issuance of the negative certification of the company name.
As commented by the expert lawyers in company formation of Forcam Lawyers, in order to make this procedure effective, the following documentation must be provided: Articles of Association, negative certification of the name of the company in the Mercantile Registry, certification of the bank with the contribution justifying the capital contributed, DNI of the founding partners and in the case that the founding partner is a foreigner must provide declaration of investments abroad.
The notary can also obtain the NIF of the company, in case the interested party wants to do it on his own, it is enough to fill in form 036 and submit it either in person or online to the AEAT (Treasury).
5)- Registration in the tax on economic activities
The company must register with the AEAT. Even so, all companies are exempt from this tax, with the exception of those whose turnover is greater than one million euros. Therefore, the vast majority of companies will be exempt from this tax.
6)- Tax Return
To start the activity, it is obligatory to present to the AEAT form 036 and the previous IAE document if the company is not exempt from the Economic Activities Tax.
7)- Registration of the company in spain in the mercantile registry
The registration of the company in the Mercantile Registry must be carried out in the province where the activity is to be carried out and within two months of the execution of the deed of constitution of the company made before a Notary Public.
Once the registration has been carried out, the Registry will deliver the deed in which the volume, folio and sheet where the company has been registered will be recorded. These data must be compulsorily reflected in all commercial documentation issued by the company such as letters, invoices, delivery notes, etc..
After these formalities, the only thing missing is to have the definitive NIF, exchanging the provisional NIF that was given at the beginning in the Treasury, so that the Company will definitively acquire a NIF.
We recommend contacting professionals with experience in the creation of business companies in Spain
Contact Forcam Lawyers, and our lawyers specializing in corporation law in Spain will study your specific case in a personalized way. We have the following offices in Spain:
Lawyer assistance in BarcelonaLawyer assistance in Madrid
Lawyer assistance in Reus