Most people starting out in Spain register as autónomo, because it takes a few days and costs almost nothing. An SL makes sense later, when profit is high enough that corporate tax beats personal income tax, or when you need to separate your personal assets from the business.
This guide covers the whole path: choosing your structure, registering with both the tax office and Social Security, what you will actually pay in year one, and what you have to file every quarter.
The one date to put in your calendar is 1 July 2027, when certified invoicing software becomes mandatory for autónomos. Companies have until 1 January 2027.
You cannot register a business in Spain without a NIE, the foreigner identification number. It is your tax and administrative ID, and both AEAT and Social Security will ask for it on day one.
Getting one takes between an hour and three weeks, depending on whether you book an appointment ahead. The fee is around 10 euros, paid through the Tasa 790 código 012 before your appointment.
The NIE is permanent and never expires. It is not a residence permit, and having one does not give you the right to live in Spain: that is a separate question, covered further down.
These are the two realistic structures, and they behave very differently.
Autónomo means you and your business are the same legal entity. Setup takes a few days, costs almost nothing, and you pay personal income tax on your profit. Your personal assets are not separated from the business.
SL is a limited company with its own legal personality. Your personal assets are protected from company liabilities, you pay corporate tax instead of income tax, and setup takes weeks rather than days.
The point where an SL starts to pay off is not a fixed number. It depends on your income tax bracket, your autonomous community, and how much profit you leave inside the company rather than paying out to yourself.
The full comparison, with the arithmetic of both routes, is in self-employed or limited company. If you are weighing it purely on tax, setting up a Spanish company vs operating as an autónomo goes deeper into the numbers.
Two registrations, both on the same date. Do the tax office first, because you need your activity code before Social Security will accept you.
Step one, the tax office. You file Modelo 036 or 037 with AEAT, choosing your IAE activity code and declaring whether your activity is subject to IVA. The walkthrough is in how to register as autónomo with the tax agency.
Step two, Social Security. You register in RETA through the Importass portal, choosing your contribution base and your mutua. The screen-by-screen guide is in how to register as autónomo with Social Security, and the form itself is covered in how to complete the TA.0521 form.
You must be registered on or before your first day of activity. Registering afterwards means backdated contributions and a surcharge.
To file anything online you will need a digital certificate or Cl@ve. If you have neither, start with how to obtain a digital certificate, because it blocks everything else.
The complete process, end to end, is in how to register as a freelancer in Spain.
Setting up a company is a longer sequence with more moving parts: reserving the company name, opening a bank account, signing the deed before a notary, and filing with the Registro Mercantil.
Minimum share capital is one euro, down from three thousand, though restrictions apply until you reach the old threshold. The standard route takes four to six weeks; the CIRCE fast track cuts that to one or two.
The full eight-step process, with current fees, is in how to register a company in Spain. For what an SL actually is and how it works once running, see limited company in Spain: everything you need to know.
Two questions come up before you start. Whether you can be the sole shareholder is answered in SL vs SLU, and whether your situation qualifies at all in who can register a limited company.
The gap between the two routes is largest at the start, and smaller than most people expect.
As autónomo, your costs are the NIE if you do not have one, around 10 euros, and your monthly Social Security contribution. With the flat rate that is 88.64 euros a month in year one, an 80 euro base plus the 0.9% MEI. No minimum capital, no notary, no registry.
As an SL, the official fees are modest if you use the fast track. What costs money is everything around them.
Filed telematically with standard bylaws, the official cost lands in the low hundreds. The four-figure numbers you see quoted usually include the share capital itself, which is your own money sitting in the company, or a gestoría handling the process for you.
The share capital is one euro as a legal minimum, but you cannot distribute profit freely until the company reaches the old three thousand euro threshold. Custom bylaws cost more than standard ones, both at the notary and in drafting. And the director's monthly Social Security contribution starts from day one, whether or not the company has invoiced anything.
Ongoing costs for the self-employed route are broken down in autónomo costs. The full setup sequence is in how to register a company in Spain.
Since 2025, autónomo contributions follow your real income rather than a base you pick freely.
Your monthly payment is your contribution base multiplied by 31.5%, a figure that already includes contingencies, cessation of activity, training and the MEI. You estimate your annual net income, that places you in one of fifteen brackets, and the bracket sets the range of bases you can choose from.
At year end AEAT cross-checks what you actually earned and Social Security settles the difference, in both directions.
The full fifteen-bracket table is in autonomo social security contributions, and how RETA works day to day is in social security for autónomos.
If it is your first registration, check whether the flat rate applies before choosing anything: autónomo social security reduced rate.
As autónomo you file quarterly and annually. The quarterly ones are Modelo 303 for IVA and, if it applies to you, Modelo 130 for income tax instalments. The annual return comes in spring.
If more than 70% of your income last year came from Spanish businesses that withheld tax on your invoices, you are exempt from filing Modelo 130.
The full picture of what an autónomo pays is in autonomo taxes.
You file corporate tax instead of personal income tax, plus the annual accounts at the Registro Mercantil.
Rates dropped for small companies from fiscal years starting on or after 1 January 2026, under a phased reduction that runs to 2029.
The rates keep falling. Microenterprises go to 17% and 20% from 2027, and reduced-dimension companies drop one point a year to 20% by 2029.
The IAE, the business activity tax. If you are an individual you are exempt permanently, with no turnover threshold. Companies are exempt below one million euros in net turnover, and everyone is exempt for their first two tax periods.
You still have to declare an activity code when you register, even though you almost certainly will not pay anything.
Every invoice you issue has mandatory fields: your NIF, the client's, a consecutive number, the date, a clear description, the taxable base, and the IVA applied. Get one wrong and your client may not be able to deduct the expense.
What changes soon is the software. From 1 January 2027 for companies and 1 July 2027 for autónomos, every invoice must be issued through a certified invoicing system that produces a QR code and a tamper-proof record. Spreadsheets and word processors stop being valid on those dates, and using non-certified software afterwards carries a fixed 50,000 euro penalty per fiscal year.
The mechanics are covered in Verifactu Spain. To build a correct invoice from scratch, see how to make an invoice and mandatory invoice details.
If your activity is subject to IVA, what is IVA in Spain explains the rates and when each applies. And if you will be issuing invoices under a company, you will need its tax number: what is a Spanish VAT number.
Choosing the tool itself is covered in best invoicing platform for Spain.
Deductions are where most new business owners leave money behind, because the rule has three parts and they need to hold at once: the expense must relate to your activity, you must hold a full invoice with your tax number on it, and it must be recorded in your books.
A ticket without your tax details does not let you deduct the IVA. Vehicles are the most restricted category, with a legal presumption of 50% business use for passenger cars.
The category-by-category list for the self-employed route is in deductible expenses for autónomos. If you are running a company, the rules differ and are covered in deductible expenses for companies.
Registering a business and having the right to live in Spain are two separate questions, and the second one comes first.
EU citizens can register without additional permits. Non-EU citizens need a valid work authorisation before registering, and the type of visa determines what you are allowed to do. Whether your specific situation qualifies is set out in can a foreigner register as autónomo.
If you have recently moved to Spain, it is worth checking the Beckham Law before you register anything, because the election has a deadline and cannot be applied retroactively. Start with Beckham Law for expats, and if you are going the self-employed route, can a freelancer be under Beckham law.
Two dates matter, and only one of them applies to you.
1 January 2027, companies must issue every invoice through certified software. 1 July 2027, the same applies to autónomos and everyone else filing personal income tax.
Verifactu has already been postponed once, so a further delay cannot be ruled out. What has changed is that the technical side is finished and running, which makes moving the date again more costly.
Separately, the mandatory business-to-business electronic invoice from the Crea y Crece law is still waiting on its implementing regulation. It is a different obligation from Verifactu, on its own timetable.
You can register as autónomo without being a tax resident, but non-EU nationals need valid work authorisation first. Being allowed to live in Spain and being allowed to work for yourself here are separate permissions.
As autónomo, one to five working days once you have your NIE and digital certificate. As an SL, four to six weeks by the standard route, or one to two through the CIRCE fast track.
Almost nothing in fees. The real cost is your monthly Social Security contribution, which is 88.64 euros in year one if you qualify for the flat rate, and otherwise depends on your income bracket.
One euro, since the Crea y Crece law. There are restrictions on distributing profit until the company reaches the old three thousand euro threshold.
No. You can file everything yourself through AEAT's electronic office with a digital certificate. Most people delegate once the quarterly filings and the deduction tracking start costing them more time than the fee.
If you are a Spanish tax resident, yes, on your worldwide income. The invoicing rules differ though: sales to businesses in other EU countries and to clients outside the EU generally carry no Spanish IVA.
Yes. It is called pluriactividad, and you contribute to both regimes. Whether it is worth it depends on your numbers, which is what autónomo vs employee works through.
There is no part-time registration in RETA, so the contribution does not scale down with your hours. What that means in practice is covered in part-time self-employed in Spain.
Almost certainly not. Individuals are exempt permanently, and companies are exempt below one million euros in net turnover. You still declare an activity code when you register.
You deregister with both AEAT and Social Security. Deregistering does not cancel obligations for periods already completed: you still file for every quarter you were registered.
