The full guide
SL or autónomo?
Autónomo | SL company | |
|---|---|---|
Liability | Personal and unlimited | Limited to the company’s assets |
Tax on profits | Personal income tax, progressive | Corporate tax, 25% general rate |
Set-up | Quick and cheap | Notary, registry and more paperwork |
Running costs | Low | Bookkeeping and annual accounts |
Many people start as an autónomo and switch to an SL once profits grow, they hire staff, or they want to protect personal assets.
Capital and the €1 rule
Since Spain’s Crea y Crece law in 2022, an SL can be set up with €1 of share capital. If capital is below €3,000, the company must put at least 20% of its profits into a legal reserve until capital and reserve reach €3,000, and in a liquidation the shareholders can be liable for the shortfall up to that figure. Most founders put in enough to cover early costs.
The steps
Step | Where |
|---|---|
Name certificate | Central Mercantile Registry (online) |
Capital deposit | Your bank |
Deeds | Notary |
Provisional NIF | Tax Agency, form 036 |
Registration | Provincial Mercantile Registry |
Definitive NIF | Tax Agency |
Social Security | Directors and any employees |
You can also do much of this online through CIRCE, the government’s company formation system, which uses a single electronic document to file with several offices at once.
Tax and ongoing obligations
The general corporate tax rate is 25%. Newly created companies usually pay 15% in their first profitable year and the next, and rates for small companies are being reduced in stages. An SL files quarterly IVA and withholding returns, an annual corporate tax return, and annual accounts at the registry. Directors who control the company usually pay into the self-employed Social Security scheme.
Common mistakes
Mixing personal and company money. Keep separate accounts from day one.
Choosing an SL too early. For low profits, the extra costs can outweigh the tax saving.
Forgetting annual accounts. Filing them late can block the company’s registry entries.
Frequently asked questions
How long does it take?
With documents ready, a few days to a few weeks. Delays usually come from the name certificate, the bank or the notary’s diary.
Can a foreigner be a director?
Yes, with an NIE. If the director lives outside Spain, the company still needs a Spanish address.
Related reading: SL or Autónomo in Spain? When a Company Makes Sense.
