Is Spain "tax friendly" (new business)?

marioIT

New member
Hello, I'm thinking of relocating to Barcelona or Valencia next winter.
Already went there and I damn like the place. Have friends there but they are either employed or self employed in different fields.
I know about ZEC in Canary Islands, forget it I don't like the place. I prefer to be on the mainland facing the Mediterranean.

I'd like to start an IT/marketing agency, also run a few websites (ads/ref) and plan to release a few apps to the stores.
I will get payments from google/amazon/apple plus direct b2b wires.
Customers are 60% USA / 40% EU.

I see there are a few Spaniards on board.
Are there good setups to keep whole tax low? I need the equivalent of an LTD.
Also just read new companies pay 15% for a few years.
Is the local tax agency a pain like other high tax EU countries?
Is it possible to register a one man ltd without paying social security while living there?
Anyone owning businesses there? what's your average tax, any problems with depreciation/company stuff/cars etc?
Is there a minimum revenue for the SL to make sense.
Are there advance payments of tax based on previous year?

Just testing the waters, I'm not entirely convinced. Will contact a professional but just want to hear some honest people opinions first.
 

Cetme308win

Entrepreneur
Hello, I'm thinking of relocating to Barcelona or Valencia next winter.
Already went there and I damn like the place. Have friends there but they are either employed or self employed in different fields.
I know about ZEC in Canary Islands, forget it I don't like the place. I prefer to be on the mainland facing the Mediterranean.

I'd like to start an IT/marketing agency, also run a few websites (ads/ref) and plan to release a few apps to the stores.
I will get payments from google/amazon/apple plus direct b2b wires.
Customers are 60% USA / 40% EU.

I see there are a few Spaniards on board.
Are there good setups to keep whole tax low? I need the equivalent of an LTD.
Also just read new companies pay 15% for a few years.
Is the local tax agency a pain like other high tax EU countries?
Is it possible to register a one man ltd without paying social security while living there?
Anyone owning businesses there? what's your average tax, any problems with depreciation/company stuff/cars etc?
Is there a minimum revenue for the SL to make sense.
Are there advance payments of tax based on previous year?

Just testing the waters, I'm not entirely convinced. Will contact a professional but just want to hear some honest people opinions first.
Spaniard here
It depends of how much money you are making....but if you are doing it well a SL could be a good choice...
Yes,the spanish tax agency is the worst one in Europa,all europeans almost says that...
Nope,you always need to pay social security here in Spain sadly....
I don't have any company in Spain because is a pain in the ass and I have better and cheaper alternatives
 

Cetme308win

Entrepreneur
like what if you don't mind ?
I was using an american LLC because of my business and with another business I'm starting I will use a HK one
Uk companies are okay as well
In Europe you guys can look for romanian microcompanies,bulgarian companies or Cyprus companies
 

marioIT

New member
Thank you for the answers. Yes I know the foreign companies you wrote.
ok but are you tax resident in Spain while using those foreign companies?

I'm talking about living year round in Spain, not "nomading".

Ok I'm pretty sure I could use US LLCs and maybe nothing would happen, but I'm not sure about the UK/EU/HK companies, once I start to open bank accounts the info would be shared to Spain...
don't they go after people for this?

Also I would rent a nice place, probably buy a decent car there in my name... I would be moving there to live not to hide!)
(also forget darks, I'm trying to understand what can be done "in the clear" with my name/docs on it)
 

Cetme308win

Entrepreneur
Thank you for the answers. Yes I know the foreign companies you wrote.
ok but are you tax resident in Spain while using those foreign companies?

I'm talking about living year round in Spain, not "nomading".

Ok I'm pretty sure I could use US LLCs and maybe nothing would happen, but I'm not sure about the UK/EU/HK companies, once I start to open bank accounts the info would be shared to Spain...
don't they go after people for this?

Also I would rent a nice place, probably buy a decent car there in my name... I would be moving there to live not to hide!)
(also forget darks, I'm trying to understand what can be done "in the clear" with my name/docs on it)
I just keep a low profile saving for living in other place when doing business here ...if my new business works well I will go to another places to live in
 

JohnSpain

New member
Being self employed (autonomo) is not bad for the first year or so (I dont recall how long the low tax is for). S.L. comes with massive cost and a tax office that spend most of its time going after small businesses. Estonia have a nice tax regime where there is no corporate tax, you only tax profits when you withdraw them, for example as a salary. Should work fine to be employed in Estonia and pay taxes and live in Spain. Spain is nice for living, just not for doing business...

If you can, consider Portugal instead of Spain, they are much more friendly to foreigners and new businesses.
 

jscargo

New member
You are critically mistaken about the reality of doing business in Spain.

To open an SL only makes sense if your net income is above 40k EUR. Anything below that, autonomo is better.

As an autonomo you will have to pay social security no matter what. There is some discount for the first 12 or 18 months, and after the amount is around 300 euro per month even if you don't make a penny. As opposed to Italy, in which you pay a % in regime forfettario (I am assuming you are from Italy).

If you have a strong desire to live in Spain I would advise you to become an autonomo and earn just part of your income in Spain. The rest you would earn through a company in a less miserable jurisdiction, and never withdraw it to Spain. Once you have a sizeable amount of money in these companies move out of Spain, acquire tax residency in this other country, withdraw your funds and then stay there or move to whatever you want.

The other alternative is, if you are earning let's say 500k per year and you have an SL. Buy everything you want in the company's name, give yourself the least salary as possible and eventually move (move first) and sell the company.

By the way you are describing the type of services you want to provide, you are actively providing then in Spain, which for the tax authorities mean tax you as much as possible. If you have a shoe factory in Vietnam then it is much easier to create a structure that is more favorable to you, because the work is not performed in Spain, and you'd have plenty of evidence supporting that.

What you can also do is become regime forfetario in Italy and autonomo in Spain at the same time, maybe this could work (would depend on your income too)
 

Cetme308win

Entrepreneur
Being self employed (autonomo) is not bad for the first year or so (I dont recall how long the low tax is for). S.L. comes with massive cost and a tax office that spend most of its time going after small businesses. Estonia have a nice tax regime where there is no corporate tax, you only tax profits when you withdraw them, for example as a salary. Should work fine to be employed in Estonia and pay taxes and live in Spain. Spain is nice for living, just not for doing business...

If you can, consider Portugal instead of Spain, they are much more friendly to foreigners and new businesses.
as a spaniard I can agree with all you said !
 

marioIT

New member
Why do I keep hearing of businessmen relocating to south Spain for tax reasons?
like malaga/marbella or thereabout
are there any local tax benefits?
 

jscargo

New member
In my opinion they probably make it under the Spanish non resident scheme.
In this situation the tax system is relatively favorable for pensioners and also for capital gains/investments.
It is good if you live out of passive income, not if you will actually do something.
Show me one single company that has relocated to Spain to actually produce goods or sell a service, the number is probably negligible.
 

Martin Everson

HNWI Offshore Consultant
Mentor Group Gold
Elite Member
Why do I keep hearing of businessmen relocating to south Spain for tax reasons?
like malaga/marbella or thereabout
are there any local tax benefits?
If you have a solid capital base or own stocks/portfolio assets then moving to Spain is an excellent idea as a businessman. If you are moving to Spain however to earn a salaried income, run a local business or work self employed from there then 100% forget it. Spain charge from 19 to a max of 23% in capital gains tax. That means businessmen with substantial capital base or who earns via shares they hold (the majority of CEO's etc) appreciating will only pay a max of 23% tax. That is actually not a bad sacrifice for a Marbella life style when compared to living elsewhere in high tax Europe with bad weather and crappier lifestyle. However Spanish wealth tax is an issue but it can be offset.
 

Perry8

New member
Why do I keep hearing of businessmen relocating to south Spain for tax reasons?
like malaga/marbella or thereabout
Taxation is Spain is probably one of the worst in Europe. If you are a non-resident it is a great place to be. I have worked a lot with Spain and nobody is volentarily moving their business there unless you have to. But, what I see more and more often is for people to get a tax residency in Spain and open an autonomo. They then keep their business in another EU-country, and just invoice this company from their autonomo. This way, you get the best of both worlds. If you live of a solid capital base Spain can also be a great place.
 

dissident

New member
If you have the choice, run away from Spain. It's a bureaucracy hell, taxes are high and authorities will try to bother you as much as they can when you start making some money. Now they even have a radical socialist-communist government that has a state-expensive economic plan that the only way to finance will be increasing taxes, instead of reducing public sector spending which will sky rock in the upcoming years. Spain will be like Italy, a sort of failed economical country, but with less productive high-value industry, where paying +60% as middle class will be real.

Really, run away unless you have a really solid connection or business deal there.
 

Perry8

New member
Really, run away unless you have a really solid connection or business deal there.
Yes, I would never set up a business in Spain that can be set up somewhere else. If you find an oppertunity in Spain (and there are many) you can of course take that, and then you just have to deal with the system. But, if you have a business you should never move it to Spain.
 

lrotter

Active Member
Spain is pain)
You need to as local as possible.
Plus get the answer/docs in English is close to impossible.
Banks are paranoid about how local you shall be.
 
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