Constitution of a company – corporate and tax issues

CORPORATE ISSUES

1) To obtain the Foreigner Identification Number (NIE).

2) By-Laws:

1. Company name
2. Company purpose
3. Number of shares
4. Share capital
5. Registered office of the company

3) Manager:

1. Sole manager
2. Joint managers
3. Separate managers
4. Board of directors

4) Shareholders

5) Certified of Bank Entity (3.000.-€ minimum share capital)

6) Public deed before notary including all the previous documents.

TAX ISSUES

– Corporate tax:

• The general CIT rate in Spain is 25%. Newly created companies are taxed at a 15% tax rate for both the first tax period in which they obtain a profit and the following tax period.
• This tax form is filed on an annual basis each 25th of July in relation to the last tax year.

– VAT:

• The general VAT rate in Spain is 21% (it is determined from the difference between the VAT from the sales and the VAT from the purchases).
• This tax form is filed on a quarterly basis.

– IAE:

• This tax is exempt during the first 2 years from the initial of activity and it is paid once the company arrives at a total income of 1 million Euros

– Social security:

• The company should pay a fixed quote for each manager (tax resident in Spain) of 315 Euros on a monthly basis.
• The company should pay for each employee (not manager) 32% of their gross salary (approximately).

For more details, please contact Escura 

Elena Escura – eescura@escura.com

Santiago Dutra – sdutra@escura.com