A foreign entrepreneur who is interested in doing business in Spain have the possibility of choosing to open a company in this country or perform his economic activity as a sole trader or empresario individual or autonomo (the Spanish version). For setting up a sole trader, there is no need to deposit a share capital or make an initial investment as you are required when you open a limited liability company or other type of company.
For an individual who is a sole trader there is an unlimited liability for the business he/she performs and this means that the sole trader is responsible for the debts and all the problems that may appear.
Every person who wants to become a sole trader in Spain needs to obtain NIE (Numero de Identification de Extranjeros) – an identification number for strangers. The citizens who are not from the European Union are required to obtain a self-employment work and residence visa.
The foreign citizens, no matter their nationality, have to register for paying IAE (Impuesto de Actividades Económicas), submit a declaration for opening the business, at the local tax office, and register for social security purposes. The contributions for the self-employed persons system (RETA) must be paid every month, even if the sole trader has no income or he/she is on sick or maternity leave.
The declaration for the tax office must contain: the date of beginning the economic activity and a description of this activity (including if it is subject to VAT), your name, address and identification number, the type of profit calculation and taxation system for your business and other few details about your business.
The sole trader in Spain is the simplest way to perform an economic activity and it is chosen by entrepreneurs who don’t have much money to spend at the beginning of their business and they don’t want to bother with many documents and accounting situations.
A sole trader can be generally open in 15 days, if you have all the necessary documents and then you can start working.
If you need more details about setting up a sole trader, you may contact our law firm in Spain. Our Spanish lawyers will offer you information about the documents you need for becoming a sole trader and will help you open this type of business.
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