Merino de la Fuente Abogados

BUSINESS IN SPAIN?

Start up your business in Spain, let us help you establish a company in Spain and get it running. Our Firm provides comprehensive services to the Spanish and international small business communities, relating to accounting, taxes, payroll, virtual office. Spain Company Formation, is a 'Merino de la Fuente Asesores, S.L.' web page for English speakers, we are placed in Madrid, Spain's Capital.

We are a small firm designed to provide information and guidance in starting and developing a business in Spain, focused on supporting startup businesses and helping small businesses succeed. Founders have for many years assisted small companies in developing their businesses.

What we do: Company formation, accounting, taxes, payroll, virtual office

We provide full corporate services.

Who are our customers?

You can visit our Spanish site to learn more about us, check optimea-credit.com, about what we do and about Spanish laws in the related areas of practices.

Why Spain?:

Economy

Potential access to over 1.2 billion consumers:

About us

Spain Company Formation, is a 'Merino de la Fuente Asesores, S.L.' web page for English speakers. We are an small tax/legal Consultancy, placed in Madrid, Spain's Capital.

Cofounders

Oscar Merino & Jose I. de la Fuente cofounders philosophy is "To Serve the client".

We are focused on supporting startup businesses and helping small businesses succeed like our partner optimea-credit.com. We provide Spanish company incorporations, accounting services, payroll and tax planning services. Founders have for many years assisted small companies in developing their businesses.

Oscar Merino

Was born in Madrid, has two children. He studied a Business Administration degree in "Universidad Autonoma de Madrid" and "Universidad Complutense de Madrid", mean while completed a law degree in "UNED". Began his international formation in the United States, continuing later in France, worked as Chief Financial Officer for "Octagon - Esedos" in Barcelona, Spain.

Jose I. de la Fuente

Was born in 1969, also in Madrid. He is a Business Administration Bachelor in Universidad Complutense de Madrid, specializing in taxation, has a wide experience in the South American markets, patrimonial companies and startups, he worked a couple years in Argentina as Chief Financial Officer and actually belongs to "Colegio de Administradores de Fincas de Madrid", (Madrid's Property Administration Association)

Our clients

They are Spanish and foreign small companies (A sample: www.filcar.es, www.estamchap-sa.com.ar, www.spainexchange.es, www.buscoafiliados.com, www.articulo.org, www.instruccionesweb.com, www.secretosadsense.com). Weather their business are earning or loosing, our customers ask for advice about their business managerial, and we are glad about their confidence on us.

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Spain business services

The main services we can offer to the small business are the most common needed, and if we can not, we also can recommend you a trustworthy collaborator in Madrid, Sevilla or Barcelona.

Company formation in Spain

There are several ways a foreign company can launch its business activities in Spain: Incorporating a New Company in Spain, Acquisition of a Spanish Company, Establishing a Spanish Branch Office, Opening a Representative Office in Spain.

Foreign companies may also gain a presence in Spain by approaching already established Spanish businesses and negotiating with them a joint venture or strategic alliance agreement.

Accounting in Spain

Most common services small business need, to start up and run, such as accounting, tax filing, payroll. Also to have the investment controlled off-site we can offer special controlling services, annual budget, budget supervision, balanced score card.

Payroll in Spain

Most common services small business need, to start up and run, such as accounting, tax filing, payroll. Also to have the investment controlled off-site we can offer special controlling services, annual budget, budget supervision, balanced score card.

Taxes in Spain

Most common services small business need, to start up and run, such as accounting, tax filing, payroll. Also to have the investment controlled off-site we can offer special controlling services, annual budget, budget supervision, balanced score card.

Virtual office in Spain

All you need is a mail forwarding service? Spain Company Formation offers the basics to give new startups a Madrid address.

Standard Features : Madrid address, Weekly mail forwarding, Urgent mail notification by email

Also we can help you settle down in Spain, looking for an office for rent, and recruiting someone with a managerial background, or administrative officer, clerk, secretary profiles.

Company formation in Spain

Even though it is necessary to study every case, Limited Liability Company is the most common business entity in Spain, means 65% of the total annual entities formation (source DIRCE 2009).

We can help you incorporate in Spain or draft the agreements with your local agent, we can even sign them representing you with a power of attorney or may be you need us to survey your investment evolution.

Spanish types of companies

Type of entity No. of shareholders Minimum capital
CORPORATION (S.A.) At least 1 At least €60,102
EUROPEAN COMPANY (S.E) At least 1 No less than €120,000
LIMITED LIABILITY COMPANY (S.L.) At least 1 At least €3,006
NEW BUSINESS LIMITED LIABILITY COMPANY S.L.N.E. Minimum 1 / Maximum 5 at the time of formation Between €3,012 and €120,202

How can you invest in Spain

A foreign investor can invest in Spain several ways, but most common ones are:

Also it is possible to launch in the Spanish market without having to physically set up a center of operations in Spain by:

General steps to incorporate any type of company

First of all, If you are not Spanish or you are not Spanish resident you will have to apply for an alien identification number 'NIE'. You can apply for it in person at the Spanish consulate in your country, or in the Chief Police Office in Spain (form EX-14). All the shareholders or directors need to have 'D.N.I' (Spanish Identification Document) or 'N.I.E.' (foreigners identification number).

fsdfWhat are the advantages of incorporation?sdf

One of the primary advantages of incorporation is the limited liability the corporate entity affords its shareholders. Typically, shareholders and directors are not liable for the debts and obligations of the corporation; thus, creditors will not come knocking at the door of a shareholder or director to pay debts of the corporation. In a partnership or sole proprietorship the owner's personal assets may be used to pay debts of the business. Maintaining the limited liability of a corporation requires that the shareholders and directors follow all the rules of governance, including holding annual meetings and maintaining meeting minutes, which is why we offer corporate forms disks and corporate kits as part of our complete incorporation package.

Other advantages

A corporation's life is not dependent upon its members. A corporation possesses the feature of unlimited life. If an owner dies or wishes to sell his or her interest, the corporation will continue to exist and do business. Ownership of a corporation is easily transferable. Capital can be raised more easily through the sale of stock. A corporation possesses centralized management.

Accounting in Spain

Our firm provides full-charge Bookkeeping Services, including Bank Statement Reconciliation, General Journal and Subsidiary Ledger Maintenance, receivables, payables, and payroll management. We prepare financial statements in accordance with Generally Accepted Accounting Principles (GAAP) for use by banks, investors, and other third parties. Our firm will also prepare custom financial reports for internal, managerial use.

The most important appointment is at the end of the financial year (after the third quarter), planning to ensure the year's result is the desired one. There is no much to do after the financial year is over

There may be different ways we can offer the accounting services:

Controlling in Spain

If your business is like most you offer more than one type of product or service. How do you know which product offerings have the best margins once all related costs are factored into the equation? The truth is most managers are surprised to learn what their true gross and net margins are once they have allocated the fixed and variable expenses. While this information is crucial to know where your business should focus its assets, cost accounting can be difficult to set up and monitor on a regular basis. We are experts at using accounting data bases to create the information you need. We are also experts at detailed ad-hoc profitability analysis using your accounting software and Microsoft Excel.

How can we help you

Accountancy legal framework

General considerations about the Spanish national chart of accounts

The Spanish National Chart of Accounts (Plan General de Contabilidad), aproved by Royal Decree 1643/1990 is of obligatory application for all companies.

Accounting principles

Accounting records

Commercial Code requires all enterprises to keep orderly accounts that are suitable for their business activities, to keep a book of inventories and balances and to keep a journal.

Also enterprises must submit the statutory books to the Mercantile Registry (Company House) in the place in which their registered office is located, in order to be authenticated.

Financial Statements

The annual financial statements are consisting of the balance sheet, the income statement and the notes to financial statements. These documents jointly form a single body of information. The whole mercantile regulation about accountant concentrate its efforts in these documents, as expression of the enterprise’s networth, financial situation at a given moment, and the annual results.

Enterprise’s directors must submit the financial statements to the Mercantile Registry (Company House) in the place in which their registered office is located, in the next month after the approval of the annual financial statements for the ordinary stock holder’s meeting.

The annual Statements and the management report placed in the Mercantile Registry (Company House) are public documents and any body can ask for a copy of them. Six years is the deadline to access to this information.

Payroll - hiring in Spain

Our firm offers complete payroll preparation and payroll tax reporting services. We prepare all returns and offer full magnetic media and electronic filing capabilities.

Bare in mind in Spain wages are paid monthly.

How much does the employee cost the company?

Salaries vary according to the sector, the professional category, the location of the business, the size of the business, etc. Labor costs in Spain are below EU and USA average.

Labor regulations

The regulation of work relationships is basically contained in the Workers Statute (Estatuto de los Trabajadores) , collective agreements and work contract.

Collective agreements are those concluded either within a company or group of companies or one or more company organizations, or within one or more worker syndicates or representative organizations. Collective agreements, in their application, are binding. Collective negotiation can be carried out at different levels: agreements in companies, state sectors, provincial sectors, etc.

Salary

Salary is determined in collective negotiation or individual contracts. Collective agreements agree a minimum professional salary level. This minimum can be increased with an individual contract.

Failing a decision in collective agreements or work contracts regarding minimum salary for professionals, the government annually sets a minimum inter-professional salary for the legal working day. 2006 minimum inter-professional salary:

Working days/Holidays

The average duration of the ordinary working day is 8 hours, 40 hours a week, and about 1.800 hours a year. It can be irregularly distributed if business activity requires it.

Employees can take at least 30 calendar days of paid holidays for a year period, which cannot be substituted with economic compensation. Also there are 12 publics holidays, along the year.

Work relationship termination

Company can terminate the work contract for disciplinary reasons in this case not severance payment is due to the employee. If the company can not accredit the reason for the disciplinary termination, or breaches the formal and procedural communication requisites, it will have to opt to either pay the employee severance pay equivalent to 45 days salary per year worked, up to a maximum of 42 monthly payments, or to readmit the employee under the conditions in place prior to dismissal.

If a permanent contract that is terminated due to objective causes is considered to be an unfair dismissal, then severance pay will be equivalent to 33 days salary per year of service, up to a maximum limit of 24 monthly payments. In these cases, the process for terminating contracts is more efficient, given that it is not necessary to request prior administrative authorisation for individual dismissals. However, such permission it is still necessary for collective dismissals.

A dismissal will be declared null and void if it is due to any of the discriminatory causes prohibited by the Constitution or legislation, or if it violates fundamental rights and collective rights of the employee. An annulled dismissal will result in the immediate readmission of the employee, and payment of any outstanding salary.

Employers can also dissolve a contract for objective reasons, such as economic, technical, organizational or production motives. If these motives are accredited, the severance paid to the employee should be equivalent to 20 days salary per year worked, up to a maximum of one years pay. If a dismissal is declared to be unfair or null and void, it will result in the same conditions as those indicated for a disciplinary dismissal. . Type of contracts in Spain:

Can foreign Staff work in Spain?

Foreigners who wish to work in Spain, either for themselves or for others, will have to obtain a work permit.

Citizens of European Union Member States and legal immigrants can accept offers of employment and move freely for this purpose within Spain.

What is Social Security (Seguridad Social)?

Social security guarantees people, families and regularized immigrants suitable protection with regard to eventualities and situations that, due to sickness, accidents or unemployment, require medical attention or economic aid to substitute the lack of income. Employees and employers are required to contribute to Social Security funds.

The Social Security system covers the following aspects: medical attention and medicines, benefits for temporary disability, risk during pregnancy, maternity, provisions for permanent, partial, total or long-term disability, retirement, death of a spouse, orphanage, provisions for unemployment, death and family protection.

Taxes in Spain

The most important appointment is at the end of the financial year (after the third quarter), planning to ensure the year's result is the desired one. There is no much to do after the financial year is over

There may be different ways we can offer the accounting services:

How does Spanish taxation works?

There are three levels of tax authority: the State (national); "Comunidad Autonoma" (regional); and Towns (local). All residents (both individuals and corporate bodies) must pay taxes on all of their worldwide income. Non-residents (N.R) are subject to taxation only on incomes earned or paid on Spanish territory. The Spanish taxation system classifies tax payments as Taxes, Levies and Contributions.

The main direct taxes applicable in Spain are:

The main indirect taxes applicable in Spain are:

How does Spanish Corporate Income Tax works? (Impuesto Sociedades)

Resident legal entities must pay tax taking into account all of their worldwide income. N.R. are subject to taxation for this tax solely for the income accrued or paid on Spanish territory. In general accounting principles coincide with corporate tax principles, very little non-accounting adjustments must be made.

There are two rates: general 35% and 30% for small size companies. Calculation: Incomes - Expenses = Profit Before Taxes. Profit Before Taxes x 35% / 30% = Net Profit

There is a system of tax incentives for small-sized enterprises, exclusively applicable to companies whose net turnover in the tax period immediately prior thereto is less than 8 million euros:

What is a tax resident?

Individuals shall be deemed to have their principal residence in Spain if they meet any of the following conditions: They spend more than 183 days per calendar year in Spain or or when the core of their economic interests lies in Spain.

A body corporate shall be deemed to be a resident of Spain if it meets any of the following conditions: It was incorporated in accordance with Spanish law, it has its registered office in Spain, it has its effective headquarters in Spain. A body corporate shall be deemed to have its effective headquarters in Spain if management and overall control of its activities are based in Spain.

What does permanent establishment (PE) mean?

When, by any legal means, a non-resident has continuous or habitual work facilities in Spain or a place to do any kind of work where he/she/it performs all or part of his/her/its activity, or when he/she/it acts in Spain through an agent with powers to enter into an agreement in the name and on behalf of the non-resident individual or body corporate, provided said powers are exercised on a regular basis, it shall be considered that the non-resident is acting in Spain through a PE.

Is it more convenient to operate through PE?.

Generally Non-residents’ tax contributions in Spain are lower if they use a PE in Spain. Also generally speaking branch and PE are equivalent concepts.

N.R. that obtain income through an PE in Spain shall be taxed for the total amount of income attributable to said PE, regardless of where it was obtained. The tax base of the PE is calculated in accordance with the provisions on the general system of the Corporate Taxation Act (Ley del Impuesto sobre Sociedades, LIS). General tax rate 35%

Income not obtained through a permanent establishment (EP): In general, the tax base shall be the gross tax base due, i.e. without deduction of any expenses, and tax rate general applicable is 25%. (aeat.es)

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Virtual office in Spain

Virtual officeWho needs a virtual office?

Small companies may need a mail forwarding service for different reasons. They may operate their business from home, they may be based outside of Spain and need a Spain presence, the business may be in the process of changing locations. These are just a few reasons why people use Spain Company Formation for their mail forwarding.

You can use our prestigious MADRID, (Spain) mail drop address for both business or personal use. We are located in 'Paseo Quince de Mayo, Number 2', situated in Madrid city. Please note it is a law firm fixed address 'Merino de la Fuente Asesores' and not a PO Box or Suite number, only for 45,00 € / month.

In case you do not need a physical presence in an office or either need having to physically set up a center of operations in Spain, a virtual office will be the most intelligent option for:

Our target:

We do not target our services to large organizations but prefer to assist small companies with a more personal trade mail forwarding service. All of the mail is personally sorted and forwarded on to its relevant destination. The service is aimed towards businesses that expect up to 15-20 items of mail per month.

If this sounds like the type of mail forwarding service that you require do not hesitate to contact us.

What does our virtual office service include:

The All-In-One Package service offered by Spain Company Formation, its perfect for a broad range of businesses from start-ups to well established businesses worldwide. A typical package will include the following:

*Registered Address just for Accounting or company formation services clients.

**Re-mailing happens when you need stamps and post office markings on the letter to appear as if they were posted from Madrid. You put all the letters you want us to re-mail in one envelope and send it to us. We will then open the envelope, stamp and post the enclosed envelopes, and mail the contents from Madrid. For this we will charge for postage and a processing fee. Just let us know what you need to determine your quote. Please contact us.

*** All bookings are subject to availability. The more advance notice you give, the more likely that the meeting room will be available.

Optional add-on services: fax on email, virtual numbers, switchboard

Actually exist numerously communications providers, offering all kind IP services, virtual numbers and so on, that can give you a phone number of the country and city you desire, and what's more, you can manage it 100% from any place in the world connecting to internet.

If you do not know any or you just prefer us to manage it, contract, configure it up, just let us know, and we'll get you a '91' prefix (Madrid), or the prefix you desire.

Our fees

45 € monthly fee

Quarterly payments in advance.

We forward mail monthly. Spain Company Formation assumes the cost of all postal charges under 2€. Any time a charge is over 2€, including any requests to forward by express mail, we charge at cost (Spanish post office current fee or your favorite courier company fee), we will apply these charges to your following quarter's bill. Spanish post office current fee 'Correos'. (i.e. 100 grams forward to New York 3,00 €, to London 2,15 €)

Collaborate with us

My name is Oscar Merino, I am a "Merino de la Fuente Asesores" Cofounders, and I want to open up our company doors to you. In Spain Company Formation we try to be approachable for clients and prospectors, therefore we offer you this section to interact with us. Any collaboration is well come.

Partnership proposa

If you are advisor or lawyer and want a delegate to represent your firm or your client here in Spain, or you are just an advisor or lawyer that wants international presence, count with us. We are looking forward spreading up our services world wide, collaborating with other professionals, offices, advisors.

Link to us

We are actively seeking new link partners and would be happy to consider a reciprocal link with your web site. Please send your contact details and your add url or web address. Learn more...

Other services

If you need any other service related and you do not see it in this web page, it doesn't mean we can not do it, let us know may be we can or can refer a reliable professional to you.

Link to us

To be included in our directory simply link to us then send an email to detailing where our link can be found and how you would like us to link to you. We only accept links from business related sites, such us: legal, taxes, advisory, virtual office, translations, real state, accounting, payroll, Spain in the world, expatriates, and so on. We do not accept graphical links, so please send as a plain text link.

Please use one of the following links when linking to Spain Company Formation website. You can copy and paste the following HTML code into your page.

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Use for virtual office, translations foreigners in Spain, travel to Spain orientated sites... Spain virtual office - Affordable mail drops in Madrid, Spain & mail forwarding service. Mail Drops, re-mailing and forwarding of mail, voicemail, fax, email.

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Use for General or business orientated sites... Spain Company Formation - business services in Madrid, Spain: form a company and run it - accounting, tax, payroll, virtual office.

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