How to Set Up an SL Company in Spain: Guide for Foreign Owners

Step-by-step guide to forming a Sociedad Limitada (SL) in Spain — foreign ownership, parent company structures, NIF/NIE for directors, tax obligations and ongoing compliance.

The Sociedad Limitada (SL) is Spain's equivalent of a limited liability company and the most popular corporate vehicle for foreign entrepreneurs and investors.

What Is an SL?

A Sociedad de Responsabilidad Limitada (SRL/SL) provides limited liability protection to its shareholders. Minimum share capital: €3,000.

Can Foreigners Own an SL?

Absolutely. An SL can be:
- 100% owned by a foreign individual — you just need a NIE
- Owned by a foreign parent company — the parent company needs a Spanish NIF (tax ID)
- A mix — combining foreign and Spanish shareholders

Foreign Parent Company Structure

Many entrepreneurs set up their Spanish SL as a subsidiary of their home-country company. Benefits:
- Centralised management from your home country
- Potential tax planning opportunities
- Clear corporate governance structure

The foreign parent company must obtain a NIF from the Spanish tax authority and appoint a representative.

Step-by-Step Process

  1. Obtain NIE/NIF for all shareholders and directors
  2. Reserve company name at the Central Commercial Registry
  3. Open a Spanish bank account and deposit minimum capital
  4. Draft articles of association (estatutos sociales)
  5. Sign before a notary (escritura de constitución)
  6. Register at the Commercial Registry
  7. Register for taxes (IAE, VAT, corporate tax)
  8. Register employees if applicable

Tax Obligations

  • Corporate tax: 25% (15% for first two profitable years)
  • Quarterly VAT returns
  • Annual accounts filing
  • Transfer pricing documentation if parent company exists