In this blog we will explain you about  Benefits of Company Registration in Spain

  • Tourism Market

    When it comes to tourism, Spain is the second largest tourism market in Europe and is the fifth largest in the world. Madrid and Barcelona are thriving locations for tourism in Spain. Barcelona has one of the largest beaches in the world which makes it an attractive tourist destination and hub. Madrid has various tourist attractions which include the bull fighting arena.

  • Government Incentives

    There are lot of government incentives offered for foreign companies in Spain. Companies which go and invest in different forms of training programs for employees would secure 75% rebate on the social security contributions. Financial subsidy is provided by the Spanish government, which includes some form of interest subsidy on bank loans.

  • Tax benefits for Trading Companies

    If a trading company is incorporated in Spain, then it is taxed at 15% for the first two years. Then the amount of tax levied on the trading company from the third year would be standard at the rate of 25%. There are different forms of Spanish Free Zones established. These free zones offer certain amount of incentives, such as some form of reduced corporate tax. VAT and stamp duty reductions would also be applicable for such companies.

  • Double Taxation Agreements

    Spain has different forms of DTAAs with other countries such as the UK, India and America. Hence an investor would not get taxed twice.

Eligible Business Structures for Company Registration in Spain

The following are the business structures for company registration in Spain:

  • Branch office

    This type of entity is also known as Sucursal. A branch office in Spain is a mere extension of the foreign parent company. The board of directors have to take the resolution for forming the branch office in Spain. The branch office is also considered as a subordinate office to the principal establishment. Branch offices in Spain would require to pay specific amount of corporate taxes. Apart from this, they would also require to pay quarterly VAT returns as per the prescribed authority.

  • Limited Liability Company

    This type of entity is also known as Sociedad Limitada. This type of entity has limited liability. This would mean that there is no form of personal liability for the members of the company. The articles of association and other laws related to the company would form the requirements of the company laws (estatutos socials). Annual accounts of the company have to be registered with the respective company registry of Spain.

  • Joint Stock Company

    This type of entity is also known as Sociedad Anónima. A joint stock company can be compared to a public limited company, which lists shares in the public stock exchange. Such form of company can list its shares in a publicly traded stock exchange. The company would have to pay corporate tax. However, dividends would also be separately taxed. Managers and Directors have the sole responsibility of running the company. Annual accounts of the company have to be registered with the respective company registry of Spain.

Minimum Eligibility Criteria for Company Registration in Spain

The following eligibility criterion has to be sufficed for company registration in Spain:

  • Minimum Capital

    The minimum capital which is required for company registration in Spain is EUR 3000. Hence from the above, it is known that registering a company in Spain is quite inexpensive. There is no requirement of minimum capital for establishing a branch office in Spain. For forming a branch office in Spain only the resolution of the Board of Directors would be required. This resolution would be supported by a general meeting.

  • Residence Requirements

    There are no residency requirements for any key management executives that go for the process of company registration in Spain. Hence a foreigner can own the company.

  • Minimum Number of Shareholders

    A branch office does not require to have minimum number of shareholders to operate. A public limited company and private limited company have to have at least one shareholder.

  • Minimum Number of Directors

    A branch office does not need to have minimum number of directors to operate. In a limited liability company, the board of directors have to comprise of at least three members. The maximum number of directors which can be appointed for a private limited company would be 12. In a public limited company, the board must comprise of minimum three members.

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