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Is Spain a Good Location to Start a Business
Spain is always a popular location for tourists, with its great culture, beautiful weather and excellent cuisine. It is also becoming a popular destination for business owners; currently, it is estimated that there are 700 British companies based in Spain.
It is essential that business owners seek legal advice prior to setting up a company in Spain to ensure that you are fully aware of all the requirements. In this guide, we will explore how a foreign national can set up a business in Spain, the factors to consider before making a decision and gain an understanding of the advantages and disadvantages of setting up a company there.
We will also consider the effects of Brexit, the legal issues, and how our experienced Spanish lawyers at Giambrone & Partners can assist.
Click on the links below to jump to that section:
Discover whether you are eligible to set up a business in Spain
What you will need to know before you consider expanding to Spain
There are plenty of benefits when choosing to set up a business in Spain...
...But there are also some downsides to be aware of
Here are some possible legal problems that you may face as a business owner
Here’s how our team of experienced Spanish lawyers can assist
Can a Foreign National Set Up a Business in Spain?
A foreign national can set up a business in Spain providing they have the correct visa, they are a legal resident and they fulfil any other criteria that is required. In order to obtain legal residency in Spain, they must apply for a residence permit and a foreign national identity card.
There are two different visas that those wishing to set up a business in Spain; the Entrepreneur Visa and the Self-Employed Worker Visa.
The entrepreneur visa allows anyone setting up a business to live in Spain for a three-year period, provided they are creating a business that benefits the Spanish economy. Businesses deemed to benefit the economy include any company that creates jobs, good investment opportunities, and a high level of technology. You must present a detailed business plan before applying for a Spanish entrepreneur visa.
The self-employed worker visa is a regular work visa and is ideal for anyone wanting to set up a smaller business. You can find out more about starting a business in Spain in our previous guide.
Factors to Consider Before Setting Up a Business in Spain
There are various aspects that individuals should consider before setting up a new or expanding their existing business in Spain. Visa requirements, tax and costs are just some of the issues that must be considered during the process of starting a business in Spain. Business owners are advised to seek legal advice from a Spanish Abogado to guide them through the process and address any unexpected issues that may arise.
If you are a national of a non-EU country, the requirements you must adhere to are slightly stricter when compared to those for EU citizens. However, there are new start-up laws that have made it easier for foreign business owners and investors to set up a business. Rather than an NIE number (a tax number), overseas business owners will need to acquire a tax identification number (NIF).
To acquire the relevant visa (entrepreneur or self-employed), business owners will need to submit relevant documents, including proof of sufficient funds, an approved business plan, proof of accredited qualifications (homologacion) for certain professions, and health insurance.
To find out more about how you can set up a business in Spain, contact us and our Abogados based in the UK or Spain will be able to assist.
What are the Advantages of Starting a Business in Spain?
There are several advantages to starting a business in Spain.
Spain has an excellent economy
Spain is the 14th largest economy in the world, and the fourth largest in the European Union. Spain has access to the world’s largest trading market, the European Union, with access to a vast number of businesses, traders and investors.
Wel- developed infrastructure
Spain’s infrastructure has considerably improved in recent years. Business owners can take advantage of the expansion of the technology industry, high speed internet connection, and advanced telecommunications technology.
Welcomes foreign investment
The Spanish Government encourages Foreign Direct Investment (FDI) and offers various incentives to allow foreign business owners to expand and relocate to Spain.
Less tax burden
The Spanish Tax Agency (STA) has set up a completely computerised system that where business can arrange their tax affairs online, saving you time when setting up a business in Spain. You can find out more about the advantages of starting a business in Spain in our previous guide.
What are the Disadvantages of Setting Up a Business in Spain?
Although there are plenty of advantages to setting up a business in Spain, there are some disadvantages to be aware of.
Different business culture
Having a good business structure and good company culture is key to running a successful business in Spain.
Language barrier
There can be a language barrier in certain circumstances, whilst English is taught and spoken in Spain you will have Spanish employees who may not have good English, or do not speak the language at all. Lack of communication can lead to misunderstandings.
Employment law
Employment law varies in comparison to the employment law in England & Wales, such as maternity leave, contractual agreements and dismissal are all different in Spain compared to the UK.
How can Giambrone and Partners help me?
Here at Giambrone and Partners, our Spanish lawyers (Abogados) help you successfully set up your business in Spain. To find out more, please get in touch with our experienced team today.