Manuel Garrido
Can foreign nationals start a business in Spain?
Yes, foreign nationals can legally start a business in Spain, whether they are EU/EEA citizens or from outside the EU. However, the requirements differ depending on your nationality. EU, EEA, and Swiss citizens can move to Spain freely, register locally, and start a business without needing a visa.
In contrast, non-EU nationals must apply for the appropriate visa or residence permit, such as a self-employment visa, an entrepreneur visa for innovative startups, or a Golden Visa if investing a significant amount. However, this option is not available anymore as the Spanish Golden Visa ended on April 3, 2025. Each route has different steps, but Spain remains open and accessible to entrepreneurs from around the world.
Is Spain a Good place to start a business?
Yes, Spain is a good place to start a business, especially for foreign nationals looking to enter the European market. The country ranks 30th on the World Bank’s Ease of Doing Business Index and has strong startup environment in cities like Madrid and Barcelona. Spain has a corporate tax rate of 25%, with a reduced rate of 15% available for new businesses during their first two years of profit.
Living and labor costs are lower than in many other Western European countries, which helps reduce operating expenses. Spain actively supports foreign investment and entrepreneurship, and it has a strong infrastructure, including the most extensive high-speed rail network in the world.
Do you need a work permit to start a business in Spain as a foreign national?
Yes, whether you need a work permit to start a business in Spain depends on your nationality.
EU/EEA/Swiss Citizens: No visa or work permit is required. You can move to Spain freely, but you must register with the local town hall (empadronamiento), obtain a Spain NIE number, and register with the social security system before starting a business.
Non-EU Nationals: Yes, you need a residence permit that allows self-employment. There are several options:
- Spain Self-Employment Visa: For freelancers or small business owners. This visa requires a business plan, proof of financial means, and qualifications.
- Entrepreneur Visa: For innovative, high-impact startups that contribute to Spain’s economy.
To learn more about the Spain Self Employed Visa
Legal Business Structures in Spain
Foreign nationals in Spain can choose from a number legal structures when starting a business. Each structure has different tax, liability, and administrative implications, so choosing the right one depends on your business size, risk, and goals.
Autónomo (Sole Trader): This is the simplest form, ideal for freelancers or solo entrepreneurs. You operate as an individual and are personally responsible for all debts and liabilities. It’s easy to set up and involves less paperwork.
Sociedad Limitada (SL – Limited Liability Company): The most popular business structure in Spain for small and medium-sized companies. It requires a minimum share capital of €3,000. Shareholders’ liability is limited to their investment in the company, which protects personal assets.
Sociedad Anónima (SA – Public Limited Company): This structure is used mainly by larger businesses. It requires a minimum share capital of €60,000. Shares can be publicly traded, and liability is limited to the capital contributed.
Sociedad Civil (Civil Partnership): A partnership where two or more people run a business together. Partners share profits, losses, and liabilities directly.
Community of Goods (Comunidad de Bienes): Similar to a partnership but less formal, where partners jointly own assets and are personally liable.
Documents Needed for Starting a Business in Spain as a Foreigner
Valid Passport or National ID: Proof of identity is required for all applicants.- NIE Number (Número de Identidad de Extranjero): Your foreigner identification number, which you must obtain before registering a business.
- Proof of address: This can be a rental contract, utility bill, or certificate of registration with the local town hall (empadronamiento).
- Business plan: This is especially important for non-EU nationals applying for a self-employment or entrepreneur visa. It should outline your business idea, market analysis, financial projections, and economic impact.
- Proof of financial means: Evidence that you have sufficient funds to start and sustain the business, such as bank statements or investment documents.
- Registration of Company Name with the Mercantile Registry Central (Registro Mercantil Central, RMC). This is needed to ensure your business name is unique and legally protected.
- Tax Identification Number (Certificado de Identificación Fiscal, CIF). This is required for all companies to handle taxes and invoicing.
- Business bank account: Needed to deposit the company’s share capital and manage financial operations.
- Deed of Incorporation (Escritura de Constitución): Must be signed before a notary public when forming a limited company or other corporate entities.
- Company Registration at the Local Mercantile Registry (Registro Mercantil): Finalizes the legal establishment of the business.
- Social Security registration: Mandatory for the business owner and any employees to access healthcare and social benefits.
Valid Passport or National ID: Proof of identity is required for all applicants.How to Start a business in Spain as a Foreigner
Starting a business in Spain entails a few legal and administrative steps that differ depending on your nationality and the type of business you want to create.
1. Obtain a NIE number
As highlighted, the NIE (Número de Identidad de Extranjero) is your foreigner identification number that is essential for all legal and tax processes in Spain and must be obtained before starting your business.
2. Choose your business structure
Decide on the legal form of your business, such as:
- Autónomo (sole trader)
- Sociedad Limitada (SL – limited liability company)
- Other structures based on your needs
3. Check and reserve your company name
Apply for a certificate of uniqueness at the Registro Mercantil Central (RMC) to confirm your chosen business name is available.
4. Open a Spanish business bank account
Deposit the minimum required capital which is €3,000 for an SL into a Spanish bank account in the company’s name and obtain a bank certificate as proof.
5. Draft and Sign the Deed of Incorporation
Prepare the company’s founding documents and sign the deed of incorporation (Escritura de Constitución) before a Spanish notary.
6. Register the company
Submit the incorporation deed to the local Mercantile Registry (Registro Mercantil) to legally register the business.
7. Obtain the Tax Identification Number (CIF)
Apply for the company’s CIF from the Spanish Tax Agency (Agencia Tributaria), which is required for tax and invoicing purposes.
8. Register for Social Security
Register yourself as self-employed or register your company and employees with the Spanish Social Security system.
9. Apply for necessary licenses or permits
Depending on your business activity and location, you may need to obtain specific licenses or permits from the local town hall or regional authorities. For example, opening a restaurant requires a health and hygiene license, while a retail store needs a commercial activity license. Some sectors, like construction or education, may require additional professional authorizations.
10. Non-EU Nationals: Obtain the Appropriate Visa or Residence Permit
If you are a non-EU citizen, apply for a residence permit that allows self-employment, such as the Self-Employment Visa, Entrepreneur Visa, or Golden Visa, before or after arriving in Spain.
Opening a Business Bank Account in Spain
Opening a business bank account in Spain is an important step for legally operating a company and managing its finances. To open an account, you will need to provide your NIE (foreigner identification number), proof of company registration or incorporation documents, your tax identification number (CIF), and valid identification such as a passport.
Many banks may also request a detailed business plan, proof of address, and information about the company’s directors and shareholders. Having a Spanish business bank account will allow you to deposit the required share capital, pay taxes, handle invoices, and manage daily expenses.
It is important to compare banking fees and services, as requirements and costs can vary between banks. Some banks also provide online banking and multi-currency accounts, which can benefit international business operations.
Taxes for Businesses in Spain
Businesses operating in Spain are subject to different taxes, with the main one being corporate income tax. The standard corporate tax rate is 25% on profits. However, newly created companies can benefit from a reduced rate of 15% during their first two profitable years. Spain also has tax treaties with many countries to avoid double taxation, which is important for foreign investors.
Other important taxes include:
- Value Added Tax (VAT or IVA): This is a consumption tax applied to most goods and services. The standard rate is 21%, with reduced rates of 10% and 4% for certain products.
- Social Security Contributions: Employers must contribute to the social security system for their employees. Rates vary but generally range from 30% to 40% of the employee’s gross salary.
- Local Taxes: Depending on the business location, companies may need to pay local taxes such as property tax or business activity tax (IAE).
- Withholding Taxes: Applied to certain payments like dividends, interest, and royalties.
Business insurance in Spain
Business insurance is another essential aspect of protecting your company against risks such as property damage, liability claims, and employee-related issues. While some types of insurance are optional, others are legally required depending on your business activities. Depending on the industry and size of your business, additional specialized insurance may be necessary.
Common types of business insurance in Spain include:
Type of Insurance | Description | Mandatory or Optional |
Public Liability Insurance | Covers claims from third parties for injury or property damage caused by your business activities. | Optional but highly recommended |
Professional Liability Insurance | Protects against claims related to professional advice or services (errors and omissions). | Optional |
Property Insurance | Covers damage or loss to premises, equipment, and inventory due to fire, theft, or disasters. | Optional |
Workers’ Compensation Insurance | Covers work-related injuries and illnesses for employees. | Mandatory if you have employees |
Employer’s Liability Insurance | Protects against claims from employees for workplace injuries or accidents. | Mandatory if you have employees |
Business Interruption Insurance | Covers lost income if business operations are disrupted by unforeseen events. | Optional |
Employing People When Starting a Business in Spain
Employment in Spain is strictly regulated, so it’s important to understand your obligations before hiring. The standard workweek is 40 hours, and employees receive their salary in 14 payments per year, 12 monthly payments plus extra pay in July and December.
Employees are entitled to 30 calendar days of paid vacation annually. The minimum wage in Spain is €1,184 per month when paid over 14 installments, or €1,323 per month when paid over 12 payments. Employers must register employees with Social Security and comply with labor laws covering contracts, working hours, and workplace safety.
How Can Global Citizen Solutions Help You?
Global Citizen Solutions is a boutique migration consultancy firm with years of experience delivering bespoke residence and citizenship by investment solutions for international families. With offices worldwide and an experienced, hands-on team, we have helped hundreds of clients worldwide acquire citizenship, residence visas, or homes while diversifying their portfolios with robust investments.
We guide you from start to finish, taking you beyond your citizenship or residency by investment application.
Frequently asked Questions about Starting a Business in Spain as Foreigner
Do I need a residence permit to start a business in Spain?
If you are an EU, EEA, or Swiss citizen, no residence permit is needed. Non-EU nationals must obtain a residence permit that allows self-employment before starting a business.
What types of business structures can I choose from?
Common options include autónomo (sole trader) and sociedad limitada (limited liability company). The right choice depends on your business size, liability preferences, and tax considerations.
How long does it take to register a business in Spain?
The registration process typically takes between 2 to 4 weeks, depending on the business structure and completeness of documentation.
What is the minimum capital required to start a company?
For a Sociedad Limitada (limited company), the minimum share capital is €3,000. Sole traders (autónomos) do not have a capital requirement.
Do I need a Spanish bank account to start a business?
Yes, opening a Spanish business bank account is required to deposit capital and manage company finances.
Are there any language requirements for starting a business?
While not mandatory, conducting business in Spanish is necessary for official documents and communication with authorities. Having a translator or local support can be helpful.
What taxes do businesses pay in Spain?
The main tax is corporate income tax at 25%, with a reduced 15% rate for new companies during their first two profitable years. VAT and social security contributions also apply.
Can I hire employees as a foreign business owner?
Yes, but you must comply with Spanish labor laws, register employees with Social Security, and follow rules on contracts, wages, and working hours.
