Once you have decided that you have a viable concept rather than a crazy idea for setting up a business in Spain, you need to decide what is the best type of company to set up.
Possibly, the easiest and most cost effective way of setting up a business in Spain is to register as autonomo (self employed) .
To register as a self employed person in Spain:
- Go to your local social security office with your NIE (Número de Identidad/Identificación de Extranjeor) and passport to obtain your social security number NAF (Numero de afiliación a la Seguridad Social). If you do not already have your NIE, you can follow the instructions here or contact us
- Once you have your social security number (NAF) , take this to the Agencia Tributaria and ask for a Modelo 036 or 037 to register the activity for your new business. Here is a list of autonomo category codes you can chose from. Ensure you chose the right activity for your new business as this will decide the level of business tax IAE (Impuesto sobre Actividades Econimicas) you will be subject to. If unsure, contact us .
- Return to the social security office with your bank book to set up the monthly social security payments.
How much will it cost?
The biggest cost of being self employed in Spain is the social security payments that are approximately €250 per month. In some circumstances this amount can be reduced. For further details about social security, click here.
Accountant fees for submitting the correct quarterly and annual VAT returns and tax reports can cost anything up to €150 per month. For a professional accounting service at a much lower fee, prices starting from only €65 per month (excl. VAT), contact us.
You are also responsible for advance income tax payments IRPF (Reglamento del Impuesto sobre la Renta de las Personas Físicas). These are paid on a quarterly basis and on presentation of your Annual tax report (Declaración de la Renta) you may be entitled to a tax rebate.
For a personal evaluation of your business idea and further details of our accounting service in Spain , contact CCB Spain .
CLICK HERE to discover the costs involved in setting up an SL Company in Spain.
By Lisa Sadleir
Having to pay Social Insurance and taxes in advance of and without any earnings is simply not reflective of an entrepreneurial society. What is the history of this?I guess its because of a lack of trust generally. Its CONTRAprerneurial! Truth is that this forces a black economy where new busines has to operate under the radar at least until it can genertate suffiucient cash flow. And cash is GOD in any small business. Even lawyers and gestors suggest working illegally at first (off the record of course).Its about time this was sorted out but Zapatero only seems to pay it lip service. Ok so reforming the ‘jobs for life’labour situations is needed but he hasn’t but any means to diversify in place and has missed a golden opportyunity. Its not as if the EU aren’t paying for it! I guess if they have massive corruption problems in governemnt the they are unlikely to trust individual so they they demand taxes before earnings and drive people underground.
There are CADE offices opening all over Andalusia to provide assistance for business but these are inadequate to say the least as far as I am informed and I’d like to hear anything to the contrary.
These want to charge consultancy fees to help new start ups and to justify there existance. The Andalucian Government really know how to block entrepreneurialism!
Access to grants is looks impossible for non-Spanish applicants.
Whilst EU regulations state there should be equality it just doesn’t happen here in reality and one only has to look at the Situations Vacant as in the Sur in English for proof (‘Good looking, females under 24 need only apply’!).
Spanish women have greater opportunity for business assistance which in itself is discriminative even if its positve discrimination for valid reason.
There’s quite a bit of bad press about these offices and the way they treat non-Spanish EU citizens in spite of the EU funding indirectly paying for these offices in the first place!
It seems a foriegner with a brilliant high technology innovation has less chance for assistance than a low tech run of the mill me-too concept if the bad press is to be believed.
What can be done about balancing all this?
What is the measure of the Black Economy?
How many business actually start-up ‘illegally’ especially in current economic conditions? surely it would be better to help new start ups through defeered taxes and low start schemes to bring them out of the black economy rather than punishing them and threatening them as per the last Government noise.
I have newly set up a business, I cheated/simplified and used a solicitor to sort out my registration. They charged 118€ and have offered to do my “accounts” at 30€ per modulo as and when. I think that is pretty reasonable for starting up!
The reduction in SS payments apparently is for under 35´s! I just missed out (shh!).
Very useful article for anyone thinking about it.