Spanish Limited Liability Company (SL)
Limited liability company · Spain
Quick answer
A Spanish SL (Sociedad Limitada) is the standard limited liability company, formed before a notary and registered with the Mercantile Register, with a EUR 3,000 minimum share capital. Standard corporate tax is 25% with a 15% rate for qualifying new companies, but obtaining an NIE, notary involvement, and several weeks of multi-step formation are common realities. This is informational only, not legal or tax advice.
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- Liability
- Limited (shareholders)
- Tax model
- 25% standard / 15% new company
- Non-resident suitability
- Limited
- Typically best for
- Iberia/LatAm-focused founders
Common founder use cases
- Founders serving Iberian and Latin American markets from an EU base
- Companies qualifying under the Start-up Law for the 15% reduced rate
- Teams drawing on Spain's growing tech-talent pool
Who it is usually good for
- Founders who can use the new-company 15% reduced rate
- Companies wanting an EU base with Iberian and LatAm reach
Who it is not ideal for
- Founders who need a fully online formation completed within days
- Founders who want to avoid notary and Mercantile Register paperwork
What this structure is
The standard Spanish limited company for an EU base; a multi-step, notary-based formation requiring an NIE, with a 15% reduced rate available to qualifying new companies.
Ownership
An SL is owned by shareholders and can be single-owner (SLU). Non-residents can own and direct it but must obtain an NIE foreigner identification number.
Liability overview
Shareholders generally have limited liability up to their contribution. The company is a separate legal person.
Tax treatment overview
Standard corporate tax is 25%, with a 15% rate for newly created qualifying companies in their first two profitable periods (extended for certified start-ups under Law 28/2022). Standard VAT (IVA) is 21%.
Formation / registration overview
Formation involves obtaining an NIE, reserving a company name, depositing share capital, signing the deed before a notary, and registering with the Registro Mercantil. Elapsed time is commonly two to six weeks.
Capital
Minimum share capital is EUR 3,000, contributed on formation.
Administration & annual compliance
Annual accounts must be deposited with the Mercantile Register, and bookkeeping commonly involves a local advisor.
Compliance
VAT returns are filed quarterly (monthly for large taxpayers), and the corporate tax return is filed after fiscal year end.
Banking & payment considerations
Major Spanish banks accept business clients but generally require an in-person visit for non-resident directors; Wise Business and N26 Business are commonly used for everyday operations.
Non-resident founder considerations
Non-residents can own and direct an SL but need an NIE, and notary and in-person banking steps make local coordination practically necessary. Verify tax positions with a qualified advisor.
Hiring & payroll considerations
Employment is governed by the Estatuto de los Trabajadores, and employer-side Seguridad Social contributions add roughly 30% on top of gross salary.
Dissolution
Dissolution involves a liquidation procedure, settling liabilities, deregistration from the Mercantile Register, and final tax filings.
Lifecycle
Spanish Limited Liability Company (SL) — typical lifecycle
Formation / registration
Formation involves obtaining an NIE, reserving a company name, depositing share capital, signing the deed before a notary, and registering with the Registro Mercantil. Elapsed time is commonly two to six weeks.Capital & ownership
Minimum share capital is EUR 3,000, contributed on formation.Operation & annual compliance
Annual accounts must be deposited with the Mercantile Register, and bookkeeping commonly involves a local advisor.Dissolution
Dissolution involves a liquidation procedure, settling liabilities, deregistration from the Mercantile Register, and final tax filings.
Founder fit (Spain)
Computed from the published jurisdiction scorers for Spain — weighted composites, not entity-specific promises.
Common mistakes
- Underestimating how long obtaining an NIE can take
- Assuming every new company automatically gets the 15% rate without meeting the conditions
- Budgeting payroll on gross salary and ignoring Seguridad Social contributions
FAQ
- What is the NIE and why does it matter for an SL?
- The NIE is a foreigner identification number required for many administrative and tax steps in Spain. Foreign founders usually need it before incorporation can progress, so it is worth starting early.
- Who can use the 15% corporate rate?
- Newly created qualifying companies can use a 15% rate in their first two profitable periods, extended for certified start-ups under Law 28/2022; otherwise the 25% standard rate applies. This is informational only.
Related
Country profile
Start a business
Business banking
Sources
- Registro Mercantil Central — Spanish Central Commercial Register (accessed )Covers: Spain's central commercial register, including company name reservation and registration of the SL.Why it matters: Official reference for Spanish limited-liability-company (SL) registration and name clearance.
- Agencia Tributaria — Agencia Estatal de Administración Tributaria — Spain (accessed )
- European Commission — European Commission — policy and country information (accessed ; reviewed )Covers: EU policy framework including the VAT One-Stop-Shop and single-market rules.Does not cover: Member-state-specific reduced rates, national thresholds, or non-EU jurisdictions.Why it matters: Used for EU/EEA market-access and VAT-OSS framing referenced across rankings and guides.Review cadence: On policy change; re-checked each data review.
- OECD — OECD — economic and tax statistics (accessed ; reviewed )Covers: Comparable corporate tax, statutory rate, and economic indicators across member and partner economies.Does not cover: Effective tax rates, deductions and incentives, local surtaxes, and personal residency rules.Why it matters: Used as a cross-country baseline to sanity-check rates against primary tax-authority figures.Review cadence: Annual, plus on major statutory changes.
- PricewaterhouseCoopers — PwC Worldwide Tax Summaries (accessed ; reviewed )Covers: Corporate income tax, VAT, and dividend withholding rates across most covered jurisdictions.Does not cover: Your specific effective rate, bespoke incentives, rulings, or transactions requiring professional advice.Why it matters: Used to triangulate rates against primary tax-authority sources, not as the sole authority.Review cadence: Updated by the publisher per tax year; re-checked each data review.
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