Doing business in Spain

Doing business in Spain

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How we can help your business makes its money transfers to and from Spain

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Forward Contract

Forward Contract

Forwards allow you to buy currency on an agreed future date at a pre-fixed rate. This may require a deposit and allows you to lock in a rate for up to two years.*

Spot contract

Spot contract

This is an agreement between you and your FX provider to buy currency at the present exchange rate and can be used for imminent payments.

Market Order

Market Order

If you need a particular exchange rate but have no urgency to purchase straight away, a market order can help you secure a better deal.

Currency options

Currency options

The most basic option offers the right - but not the obligation - to exchange currency at a known rate for a known date in the future**.

Guide to business in Spain for foreigners

What are some major industries in Spain?

Spain is a hub for imports and exports – Valencia is the busiest port in the Mediterranean and the fifth-busiest in Europe. Fossil fuels, chemicals, machinery and consumer goods are imported from across the world, primarily from Germany, France and China. The key exports reflect the diversity of industry in Spain and include pharmaceuticals, automobiles, winecitrus fruits and other agricultural goods.

Business in Spain is varied and focused on a number of growing markets. As well as agriculture, manufacturing, energy and electricity are major industries in Spain and tourism is a major contributor to the economy, accounting for 11% of GDP.

If you’re looking for an opportunity to grow a tourism business in Spain, you’ll benefit from a ready-made market. More than 75 million tourists visit the country each year and it is the world’s third most popular tourist destination. If you’re starting a tourism business in Spain, you’ll also benefit from the fact that the World Tourism Organization HQ is located in Spain, providing a great opportunity to build your business with a strong and well-connected network. 

While one of the biggest industries in Spain, tourism isn’t the only option is you’re looking to start a business there. Automobiles and pharmaceuticals are among the leading exports in Spain; the country is the second-largest car manufacturer with 2.8m units a year and the pharmaceutical market is valued at USD25 billion. Energy is also a growing industry in Spain; the country has invested heavily in renewables and while only 3% of the electricity produced is currently exported, this is an area that looks set to grow.

The cost of starting a business in Spain

If you’re concerned about costs, the cheapest way to get started is to form an unincorporated company, either as a sole trader (empresa individual) or partnership (sociedad civil). With these arrangements, there are no minimum investment requirements and there is significantly less red tape than registering a limited company. 

How to open a business in Spain

EU citizens can register a business in Spain, with relative ease, whether this is setting up as a partnership or as a sole trader. However, expats outside the EU will require a work permit to be able to move to Spain and register a business. Work permits must be renewed every year, but after five years you can apply for residency and will no longer need to apply on an annual basis if this is granted.

Registering as a limited company in Spain has a minimum financial requirement, so you’ll need to be able to demonstrate that you have the resources to back your business. The sociedad limitada or S.L. Incorporation is the most common form of limited company; the structure protects business owners from personal liability in the event of bankruptcy, but does involve additional tax, accounting, and mercantile obligations including annual corporation tax returns and statutory accounts. There are additional declarations required, including filing VAT returns (IVA). The rules are less stringent for sole traders and partnerships, and as an individual you can also set up as a freelancer, known in Spain as profesionales autonomos.

Visit our Brexit Hub to stay up to date with the latest developments regarding the UK’s relationship with Spain and what that will mean for businesses going forward.

What documents do I need for registering a business in Spain?

As well as EU citizenship or a valid work permit, you will also need the following to start a business in Spain:

  • Foreigner’s tax identification number (NIE)
  • Registration to the Mercantile Registry (Registro Mercantil Central or RMC)
  • Company tax identification number (CIF)
  • A business bank account with a minimum deposit of €3,000
  • Signed deed of incorporation
  • Social security registration

If you’re planning to open a subsidiary business in Spain, the process is simpler, but you will need to include the following in your application:

  • A copy of the main company’s certificate of incorporation and certificate of good standing
  • Notarized power of attorney
  • Spanish tax identification number (NIE)
  • A member of staff at the Spanish branch to be a resident in Spain, who will agree to be liable for any company debts and tax payments

What is the corporate tax in Spain?

The general rate of corporation tax in Spain is 25%, however other taxes may also apply depending on the nature of your business and industry as well as if your organisation is a resident company in the country. It’s worth taking the time to research your corporate tax obligations for conducting business in Spain, to make sure you have all bases covered and will be paying the correct figure.

What are the challenges of doing business in Spain?

A review from World Bank and International Finance Corporation ranked Spain 136th in the world for how simple it is to start a business, with ten procedures - each with several stages – to complete. Some businesses have found the level of bureaucracy and red tape to be one of the main challenges of doing business in Spain, which is why it’s worth checking all the requirements before you make the move. Construction permits take 182 days to be delivered and require several inspections and certificates.

Connection to the national grid can be high cost initially and requires permission from the local council. Property registration requires five separate procedures and while taxation on profits is relatively low compared to elsewhere in the world, labour tax and contributions are higher than the OECD average and a survey estimated that it takes 167 hours a year and eight separate payments to meet all tax requirements.

What is the business environment in Spain like?

When it comes to work culture, Spain is a diverse and multicultural society. Personal relationships are important in the business environment so take the time to build a strong network and become familiar with the business customs in Spain. When it comes to employing staff, most employees work a 40-hour week, have 30 days’ annual leave and are made 14 salary payments per year – one a month, with additional payments in July and December.

FX Solutions

FX Solutions

Our team will work with you to identify your requirements and offer a range of products including Spot Contracts, Market Orders and Forward Contracts to meet your needs.

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Get in touch & learn more about how we can send money to and from Spain

Get in touch & learn more about how we can send money to and from Spain

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