Guide to Starting a Business on the Costa Blanca

Starting up a business on the Costa Blanca is a challenging but exciting feat. Below is all the essential knowledge you will need to know before getting started.

There are two types of business models, each with different approaches. You can set up a limited company (SL) as a self-employed sole trader, or as an unincorporated partnership if there is more than one person involved. 

Once they have their NIE number, any EU citizen can set up a business in Spain. Any non-EU citizen requires a Residence Visa (if they intend to stay more than 3 months).

It is also important for new businesses to be aware of IAE tax (Impuesto de Actividades Económicas). New businesses are exempt for 2 months, along with businesses turning over less than a certain amount. All new businesses need to register for IAE.

There are some requirements that apply to all businesses on the Costa Blanca. You will need to:

- Register the company name via an application for a Certificate of Uniqueness from the Central Commerical Registry.

- Open a bank account and deposit the capital

- Obtain a Public Deed of Incorporation before a notary, which includes the names of shareholders, tax identitifcation number and the Certificate of Uniqueness

- Apply for a CIF at the Tax Office: a company tax identitifcation code. A provisional number will be given immediately, whilst a permanent CIF number must be obtained within six months.

- Pay transfer tax and stamp duty at the local Tax Office. The deed of incorporation and the CIF will need to be presented within 30 days of obtaining the public deed of incorporation.

- Submit a formal declaration to start activity, filed at the local Tax Office.

- Register for tax at the local Tax Office

- Legalise company books - this includes account books, a minutes book and VAT register books. These should be submitted to the Central Commercial Registry for verification before they are used.

Certain businesses may also be required to obtain activity-specific licences, which may have a fee.

If you are setting up as a self-employed sole trader, you must also:

- Register to pay IAE

- Register a declaration for starting a business at the tax office

- Register for Spanish Social Security within 30 days of registering to pay IAE, as a self-employed worker 

Non-EU citizens will also need to apply for a combined self-employment work and residence visa as well. After setting up, you will need to make monthly payments into the self-employed persons system, RETA.

If you are setting up a business partnership or co-ownership, you must also:

- Sign a partnership agreement before a notary

- Register to pay IAE

- Register a declaration for starting a business

- Register for social security

- Apply for an opening licence at the Town Hall (if there are business premises). Without this, the business does not legally exist.