Starting a business in Spain involves not only complying with a series of legal steps, but also keeping up to date with tax and accounting matters to ensure the correct operation of the business. The following is a practical guide to the basic tax and accounting aspects that every entrepreneur needs to know in order to get off to a good start in the business world.
1. Choosing the legal form of the company
The first step in formalising the creation of a company is to select the legal form that best suits the needs of the business. Among the most common options are:
- Self-employed: suitable for individual entrepreneurs, although with unlimited personal liability.
- Sociedad Limitada (SL): offers limited liability to the partners and requires a minimum share capital of 1 euro, following the reforms of the Law on the Creation of Companies.
- Sociedad Anónima (SA): requires a share capital of 60,000 euros and is suitable for large investments and operations.
In case you choose the option of doing it through an S.L. or S.A., the following considerations must be taken into account:
2. Registration in the Commercial Register
Once the legal structure has been defined, it is necessary to register the company in the Mercantile Register, where negative certification of the company name is requested to confirm that the chosen name is not in use. This is crucial to guarantee the company’s unique identity, and the certification is valid for six months.
3. Opening a Business Bank Account
Before formalising the company, the partners must open a bank account in the name of the company and deposit the minimum share capital corresponding to the type of company. The bank will provide a capital deposit certificate, which will be required for the signing of the public deed.
4. Drafting the Articles of Association
The company must have articles of association that define essential aspects such as the corporate purpose, the organisational structure and the internal functioning of the company. The articles of association are required at the time of the notarial deed, which gives the company its official legal personality.
5. Accounting and Compulsory Registers
Accounting is a fundamental tool for any company, especially in its first steps. Companies in Spain must comply with the General Accounting Plan (PGC), which establishes how the company’s income, expenses, assets and liabilities must be recorded. Some key aspects of start-up accounting are:
- Accounting books: All companies must keep compulsory accounting books, such as the Journal and the Inventory and Annual Accounts Book.
- Balance sheet and annual accounts: These must be presented at the end of each fiscal year, and it is recommended to keep a monthly control of income and expenses to avoid problems at year-end.
6. Management of Withholdings and Tax Payments
The company must withhold personal income tax on its employees’ salaries and declare these amounts periodically. Withholdings and payments on account also apply to payments to self-employed suppliers, and their correct management is essential to comply with tax regulations.
8. Tax Benefits for Start-ups
In order to lighten the initial tax burden, start-up companies can access some tax benefits, among which the following stand out:
- Accelerated depreciation: Allows greater deductibility of investments in fixed assets during the first few years.
- VAT exemption: In the first year, if turnover is less than 250,000 euros.
9. Professional Consultancy
Given the complexity of tax and accounting issues, it is advisable for a start-up company to have a tax and accounting advisor. An advisor can ensure compliance with all obligations and optimise the available tax advantages.
The first fiscal and accounting steps in a start-up company in Spain involve choosing the right legal form, complying with registration obligations, managing the relevant taxes and keeping accurate accounts. With these elements under control, entrepreneurs can concentrate on growing their business and avoid legal or tax problems in the future.
At Gutiérrez Pujadas & Partners, we offer a comprehensive tax and accounting advisory service tailored to start-ups, both nationally and internationally. We have a team of experts who guide our clients through every phase of their growth, from incorporation and initial compliance with tax obligations to the development of accounting strategies and tax optimisation. We specialise in tailored advice and innovative solutions to support entrepreneurs in their long-term success.
For more information about our advisory services and how we can support you in growing your business, please visit our services page.