The Two Main Options: SL vs Autónomo

For foreigners starting a business in Spain, there are two common structures: the Sociedad de Responsabilidad Limitada (SL) — equivalent to a UK Ltd or US LLC — and the Autónomo — the Spanish equivalent of a sole trader. Choosing the right structure depends on your liability tolerance, expected income, and growth plans.

Autónomo (Self-Employed)

The Autónomo registration is simpler and cheaper to set up. No minimum capital required, and you can be trading within a few weeks. However, as an Autónomo, you are personally liable for all business debts.

Key facts about the Autónomo regime in 2026:

  • Monthly Social Security contributions are income-based (approximately €230–€590/month) following the 2023 reform.
  • Income is taxed through IRPF (personal income tax) at progressive rates up to 47%.
  • New Autónomos benefit from a flat rate of €85/month for the first 12 months (tarifa plana).
  • Quarterly IVA (VAT) returns and annual IRPF declarations required.

The Autónomo structure suits freelancers and consultants. For higher profits or personal asset protection, the SL is generally preferable.

Sociedad Limitada (SL)

The SL provides limited liability — shareholders are not personally responsible for company debts. Minimum share capital is just €1 following recent reforms.

Key facts about the SL in 2026:

  • Minimum 1 shareholder (can be a single person).
  • Corporation tax at 25% on net profits (15% for new companies in first 2 profitable years).
  • Directors may also need to register as Autónomos for Social Security.
  • Annual accounts must be filed with the Mercantile Registry.
  • More administrative overhead than Autónomo, but typically handled by a gestor.

How to Form an SL in Spain: Step by Step

  1. Obtain NIE numbers for all shareholders and directors.
  2. Reserve the company name at the Central Mercantile Registry (1–5 days online).
  3. Open a company bank account and deposit minimum share capital.
  4. Draft the Articles of Association — your lawyer prepares the estatutos sociales.
  5. Sign the Deed of Incorporation before a Spanish notary.
  6. Register with the Tax Agency for a CIF (company tax number).
  7. Register in the Mercantile Registry of Málaga.
  8. Register for IVA and set up quarterly filings.

Total timeline: typically 2–4 weeks from start to fully operational company.

Costs of Setting Up an SL in Spain

  • Notary fees: approximately €300–€600
  • Mercantile Registry registration: approximately €100–€200
  • Lawyer fees: approximately €800–€1,500
  • Share capital: minimum €1
  • Ongoing: monthly gestor/accountant fees (approximately €100–€200/month)

Frequently Asked Questions

Yes. Non-residents can be shareholders and directors of a Spanish SL. You'll need an NIE number and a Spanish bank account. However, if you're actively managing the company in Spain, you may trigger tax residency obligations — take specialist advice before proceeding.
For income below approximately €40,000–€50,000/year, the Autónomo can be more tax-efficient. Above that level, or when personal asset protection matters, the SL is generally more advantageous. Always discuss with a Spanish tax advisor first.
Yes. Brexit has not affected the ability of British nationals to own and operate Spanish companies. The process is the same as for any non-EU national.