Spain Incorporation - Spanish SL Company - ETVE - SRL - SL
- WHAT ARE THE DIFERENTS FORMS OF COMPANIES IN SPAIN?
Spanish law envisages different kinds of mercantile entities, all of which can be used by foreign investors. The founders of a company have a great deal of flexibility in tailoring the structure of the company to their specific needs through appropriate drafting of the bylaws, for which purpose they should seek proper legal advice.
The most significant are:- CORPORATION ( “Sociedad Anónima” , abbreviated as “S.A.”). The minimum amount of capital stock required for an S.A. pursuant to the Corporations Law is 60.102 euros. The capital must be fully subscribed and at least 25% of the par value of the shares must be paid in. The shareholders or their representatives must appear before a notary public in order to execute the public deed of incorporation, which includes the bylaws. Subsequently, the public deed of incorporation has to be registered in the Mercantile Register. Upon registration, the company acquires the status of a legal entity.
- LIMITED LIABILITY COMPANY ( “Sociedad de Responsabilidad Limitada” , abbreviated as “S.L.” or “S.R.L.”). An S.L. cannot have a capital stock of less than 3.005 euros, which must be fully paid up. Capital stock must be divided into participation units, but these need not all be the same. Participation units are generally not freely transferable. Debenture issues cannot be used as a means of raising funds. No independent appraiser's report on non-monetary contributions is required, although the founders and shareholders are jointly and severally liable for the genuineness of the non-monetary contributions made.
- GENERAL PARTNERSHIP ( “Sociedad Regular Colectiva” , abbreviated as “S.R.C.” or “S.C.”)
- LIMITED PARTNERSHIP ( “Sociedad en Comandita” , abbreviated as “S. en Com.” or “S.Com.”) or LIMITED PARTNERSHIP BY SHARES (“Sociedad en Comandita por Acciones” , abbreviated as “S. Com. p. A.”)
3000 Euros
For 2 nd year, and thereafter, CALL US; annual fee includes government taxes and filling annual tax report.
- WHAT ARE THE TAX RATES APPLICABLE IN SPAIN
INCOME TAX RATES
Number of tax brackets Lowest rate (from € 0 to € 4,000) Top rate (from € 45,000 on) Income tax-exempt (mínimo personal) Capital gains rate (on savings raised alter more than one year) Reduction coefficient for irregular salary income Reduction coefficient for savings income generated over more than two years SPANISH CORPORATE TAX RATES
The current standard corporate income tax rate is 35%. The tax rate for companies whose net sales (calculated for the group, if applicable) in the immediately preceding tax period (or in the current period in the case of newly-incorporated companies) amount to less than five million euros is 30%, applicable to the first € 90,151.82 of taxable income. Any taxable income above that amount is taxed at 35%. Special rates are applicable to certain entities such as certain cooperatives (20%), the so-called asset-holding companies (40%), which regime has substituted the former fiscal transparency one, and the foreign-securities holding companies (see www.investinspain.org , Incentives and FAQ).
SPAIN: VAT RATES
The standard rate is 16%, applicable to most sales of goods and services. A reduced rate of 7% is applicable, amongst others, to sales and imports of human and animal foodstuffs, except alcoholic beverages, water, pharmaceutical products, private homes, and, among others, to the following services: domestic transportation of passengers & their luggage, hotels, restaurants, theatres and cinemas. There is a super-reduced rate of 4% applicable to: bread, flour, milk, cheese, eggs, fruits and vegetables; books, newspapers and magazines not mainly containing advertising; pharmaceutical specialities; cars & prostheses of handicapped persons; and certain officially sponsored housing. Supplies of goods and services relating to insurance and financial activities, health, education, rental of residential property, etc., are VAT-exempt.
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