The Spanish equivalent of a UK Ltd or US LLC — how to incorporate an SL as a foreigner, what the €3,000 capital really covers, and how to structure the formation so year one runs clean.
The Sociedad Limitada — SL — is Spain's default operating company. It's what you form when you want limited liability, want to hire employees, want to raise investment, or want to trade with serious corporate clients who won't engage with an autónomo. For most expat founders building a real business, the SL is the right structure.
This page walks through incorporation as we handle it for international clients: the €3,000 minimum capital, the notarial deed, the Mercantile Register filing, the CIF activation, the foreign investment reporting for non-EU shareholders, and the sequence of steps that gets you from engagement letter to trading live in around 10–15 working days.
Most of our SL clients are existing business owners elsewhere — UK Ltd directors expanding into the EU, US LLC founders setting up a Spanish operating base, Irish consultants going from autónomo to corporate structure, Australian families relocating their business to Spain. The incorporation itself is procedural; the strategic work is structuring it so it interacts cleanly with your existing foreign entity, your residency, your tax position, and your long-term exit plan.
Every SL formation is scoped and quoted in writing. The fee covers the full legal process — name reservation, drafting, notary coordination, Mercantile Register filing, tax activation and foreign investment reporting.
Understanding what you're forming helps you avoid the mistakes most first-time founders make in year one. The SL is a fully separate legal personality — but that separation only holds if you respect the corporate formalities.
Once registered at the Mercantile Register, the SL exists as a legal entity in its own right. It holds its own assets, signs its own contracts, sues and is sued in its own name. Shareholders are not personally liable for company debts beyond their capital contribution — in normal circumstances.
The phrase 'normal circumstances' matters. If you commingle personal and company finances, skip annual filings, or trade while technically insolvent, the limited liability protection can be pierced. Keeping the corporate veil intact is an ongoing discipline, not just something you set up once.
Spanish SLs require a minimum share capital of €3,000, deposited in the company bank account before the notarial deed is signed. This capital is the company's equity — it's not a fee and it's not spendable until the company is live, at which point it funds working capital.
Under the Startup Law (Ley 28/2022), SLs can now be formed with as little as €1 in capital (SL en formación sucesiva), but with substantive restrictions on dividend distributions until €3,000 is accumulated. For most founders, depositing €3,000 upfront is cleaner and avoids year-one compliance friction.
The SL has three distinct roles. Shareholders own the company. Administrators (or the board of directors) manage it. Apoderados hold specific powers of attorney. You can be all three as a sole founder, but the roles are legally distinct.
Administrators owe fiduciary duties to the company and can be held personally liable for unpaid tax and Social Security debts if the company becomes insolvent. For non-resident directors, there are additional tax implications. We structure the administrator role deliberately, not as an afterthought.
The escritura is the notarial deed that creates the company. It contains the articles of association (estatutos sociales), the capital contribution, the identities of shareholders and administrators, and the initial corporate purpose.
The articles are where most DIY formations fail. Generic templates rarely address quorum, transfer restrictions, pre-emption rights, dividend preferences, board composition — the things that matter when the company grows. We draft articles that actually work three years in, not just templates that get past the notary.
This is the standard timeline for an SL formation where all shareholders have NIE, the capital is ready to deposit, and there are no special structuring issues. More complex formations — non-EU shareholders, multiple share classes, holding structures — add a few days to specific stages.
Written scope confirmed, fixed fee agreed. Structuring call covers shareholding, administrator role, corporate purpose, name options, and any specific clauses for your articles.
We file for the certificación negativa at the Central Mercantile Register. This confirms your chosen company name is available. Typically returned in 48–72 hours.
Provisional company bank account opened, €3,000 capital deposited, bank issues the formal deposit certificate. In parallel, we draft the escritura and articles.
All shareholders and administrators sign at the notary (in person or via power of attorney). The notary issues the deed the same day.
Deed filed electronically at the Mercantile Register. Typical turnaround is 3–5 working days. Once registered, the company has full legal personality.
Modelo 036 filed, CIF issued, IVA and ROI registrations where needed, Modelo D1A for non-EU shareholders. Company is live, invoicing-ready and tax-compliant.
A proper SL formation is eight discrete pieces of work, all coordinated so the company is not just incorporated but fully operational.
Up to five proposed names submitted to the Central Mercantile Register. First available name is reserved in the company's name for six months.
Bespoke articles drafted to your shareholding and governance — not generic templates. Includes transfer restrictions, pre-emption rights and director powers.
€3,000 (or €1 under Startup Law) deposited in the provisional company account. Bank issues the certificate that the notary requires for signing.
Signing coordinated at the notary, with powers of attorney drafted for any non-resident shareholders or administrators who can't attend.
Deed filed for registration. Once registered, the company is a full legal entity and can trade in its own name.
Permanent CIF issued by Hacienda. IVA regime declared. Intra-EU VAT (ROI) activated if relevant. All via Modelo 036.
Modelo D1A filed with the Registro de Inversiones for non-EU shareholders. Must be filed within one month of capital deposit.
Corporate book, digital certificate, compliance calendar, gestor introduction, and a written brief on the first year's obligations.
A snapshot of SL formations we've handled recently — the pattern of decisions matters more than the specific details.
The situation. UK Ltd with two directors, €1.2M annual turnover. Both directors relocating to Madrid and want to move the operating base to Spain for EU client proximity.
How we'd handle it. New Spanish SL formed with the two founders as shareholders. UK Ltd retained for historical contracts, with a services agreement between the two entities on arm's-length terms. Transfer pricing documented from day one.
The situation. Delaware LLC running a 7-figure DTC brand. Wants a Spanish SL as the EU holding company for European warehousing, VAT and customer-facing presence.
How we'd handle it. SL formed with the LLC as sole shareholder. Modelo D1A filed. Warehouse lease reviewed. Commercial services agreement between LLC and SL drafted on a cost-plus basis. Beckham Law assessed for the relocating founder.
The situation. Both currently autónomo with combined net income approaching €140k. Starting to feel the personal tax progression and want to protect forward income.
How we'd handle it. SL formed with both spouses as 50/50 shareholders and joint administrators. Autónomos deregistered cleanly at year-end. Business assets transferred at book value under the Spanish tax-neutral restructure rules.
The situation. €4M property portfolio on the Costa del Sol, currently held personally. Consolidating into a holding SL for succession planning and annual tax efficiency.
How we'd handle it. Holding SL formed with family trust as shareholder. Property transfer structured as a non-cash contribution. ITP (transfer tax) impact modelled and minimised. Inheritance strategy integrated from day one.
These are the issues that create problems 6–18 months into trading — expensive to fix retroactively, trivial to avoid at formation.
Templates that don't address transfer restrictions, quorum or director powers create deadlock when anything non-standard happens. Bespoke articles cost nothing extra at formation and save legal fees later.
Sole administrator, joint administrators, joint-and-several administrators and a board all have different liability and signing implications. The default 'joint and several' is rarely the best choice and often the worst.
Some founders deposit the €3,000, sign the deed, then immediately withdraw it as 'owner drawings'. This creates accounting issues, potentially triggers insolvency indicators, and is exactly what the formal system is built to prevent.
Non-EU shareholders have a one-month window to report the investment. Missing it is a technical breach and creates questions if the shares are ever transferred, distributed or financed.
Every administrator needs a Spanish NIE. Some clients appoint a family member as administrator to save on director fees, only to discover the family member's NIE process takes longer than the formation and delays the whole deed signing.
The SL's IVA treatment is declared on Modelo 036 at activation. Wrong regime means wrong quarterly filings for the whole first year. This is a ten-minute decision that costs months if skipped.
The SL is the default for a reason — but other structures are worth considering for specific situations. This is the comparative view.
SL formation is a procedural process with strategic consequences. The articles you sign, the administrator structure you choose, and the tax activations you file in the first month shape your company's compliance and flexibility for years.
Our corporate team handles SL formations for international founders weekly. Every formation is led by a bar-registered Spanish solicitor and supported by a tax specialist. No off-the-shelf templates, no 'formation factory' pipeline — every company is built around its actual founders.
From incorporation onward we run your company's Spanish accounting and tax compliance month to month — modelos, corporate filings, bookkeeping and reporting, all in one place.
A simple monthly fee, tailored to your activity.
Book a structuring call with a bar-registered solicitor and a corporate tax specialist. Written scope, fixed fee, and an SL formation built to survive year three, not just pass the notary.