An Overview of Spain Startup Law and Ecosystem
Lawants Guide · Startup in Spain Spain changed the practical equation for foreign founders in 2023. The Startups Law (Law 28/2022) introduced a 15% corporate tax rate for qualifying innovative companies, a dedicated startup visa for non-EU founders, fast-track incorporation in as little as six working hours, and improved conditions for employee stock options. These are not marginal improvements: they make Spain directly competitive with the EU startup hubs that were previously the default choice.
The difficulty is that not every innovative company qualifies under the law. The tax benefits, the startup visa, and the simplified incorporation process all depend on meeting legal requirements that are assessed individually by ENISA, Spain’s public innovation agency. A tech startup qualifies differently from a digital agency. A scaleup with €8 million in revenue qualifies differently from one that has just crossed €10 million. A foreign founder applying from outside Spain follows a different path from one already in the country. The question is not whether the law is useful. It is whether it applies to your specific situation.
Lawants advises foreign founders and international companies on Spanish startup incorporation, Startups Law certification, and visa applications. Roberto Bosco, Managing Director, reviews every project personally and replies within 24 business hours.
What Is a Startup in Spain? Definition Under the Startups Law
Not every new company qualifies as a startup under Spanish law.
The Startups Law (Law 28/2022) sets specific criteria that determine whether a company can access the preferential tax rate, the startup visa pathway, and the other benefits the law provides. Understanding these criteria is the first step, because a company that assumes it qualifies but does not will pay corporate tax at 25% instead of 15% and will not access the visa routes reserved for qualifying founders.
To qualify as a startup under Law 28/2022, a company must meet all of the following criteria:
- it must be newly created or have been incorporated within the last five years (seven years for biotech, energy, industrial, and other strategic sectors);
- it must have its registered office or permanent establishment in Spain;
- it must not have distributed dividends or returns on capital;
- it must not be listed on a regulated market;
- it must not have annual revenues exceeding €10 million;
- and, most importantly, it must have an innovative character aimed at solving a problem or improving an existing situation through new or advanced methods.
The innovative character requirement is evaluated by ENISA (Empresa Nacional de Innovación), the public agency responsible for certifying startup status under the law. Certification is not automatic: it requires an application and assessment of the business model, the product or service, and the degree of innovation. In our experience, founders who underestimate this step are the ones who build their financial model around a 15% tax rate and then discover the certification was not granted.
Does Your Startup Actually Qualify Under the Startups Law?
Innovation is assessed, not assumed. ENISA does not certify companies because they are digital or technology-based. It certifies companies because their innovation is demonstrable: a new method, a new product, a new process, or a new application of existing technology that creates genuine economic or social value. The type of business matters, but so does how the innovation is described and evidenced in the application.
| Typically qualifies | Typically does not qualify |
|---|---|
| SaaS with proprietary technology | Restaurant or hospitality business |
| AI or machine learning application | Standard consulting firm |
| Deep tech or hardware startup | Generic digital agency or web studio |
| Medtech or biotech company | E-commerce without proprietary technology |
| Climate or cleantech venture | Traditional import/export business |
| Venture-backed tech startup with R&D investment | Company exceeding €10 million annual revenue |
These are indicative categories. Eligibility is always assessed individually. A company in a “typically qualifies” category may not receive certification if the innovation is not clearly documented. A company in a “typically does not qualify” category may qualify if it has a genuinely innovative component.
The safest approach is to confirm eligibility before building the financial model around the 15% rate, rather than discovering after incorporation that the certification was not granted or applies for a shorter period than planned.
Whether your company qualifies under the Startups Law determines the tax rate, the visa pathway, and the certification process. Assuming eligibility is not the same as having it.
Lawants works with foreign founders on startup incorporation and Startups Law certification in Spain, confirming eligibility before the company is incorporated and the financial plan is built around a tax rate that may not apply.
Ranked among the Best Law Firms Spain · Offices in Barcelona and Madrid
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Response within 24 business hours
The Spanish Startups Law: What Actually Changed
Law 28/2022, the Spanish Startups Law, came into force in January 2023. It did not create a new type of company: qualifying startups are still incorporated as standard S.L. or S.A. entities. What changed is the tax and administrative regime that applies to them, and the immigration pathway available to their founders.
Reduced Corporate Tax Rate: 15%
Qualifying startups pay corporate income tax at 15% for the first four years in which taxable income is reported, rather than the standard 25% rate. Companies can also defer tax payment in the first two years without accruing interest or providing guarantees. This is a meaningful reduction for startups that reach profitability early, and it applies automatically once ENISA certification has been granted.
Improved Stock Option Regime
One of the most operationally significant changes is the treatment of employee stock options. The exemption threshold for stock options was raised from €12,000 to €50,000 per year. Additionally, the taxable event for share delivery was deferred until the shares are sold or listed, rather than at delivery. This makes equity compensation significantly more attractive as a talent retention tool for startups competing with larger employers.
Fast-Track Incorporation
Companies adopting standard bylaws (estatutos tipo) can now be incorporated in as little as six working hours through the CIRCE online platform, with notarial and registry fees waived. This is a genuine procedural improvement, though in practice the timeline is only achievable when all documentation is ready and the shareholder structure is straightforward. Foreign corporate shareholders still need to obtain their own Spanish NIF before the deed can be signed, which adds time that the six-hour headline does not reflect.
Investor Deduction
Individual investors in certified startups benefit from a deduction of 50% of the amount invested in the startup’s shares, up to a maximum base of €100,000 per year. This is applicable to IRPF (personal income tax) and makes Spain more attractive for angel investment in qualifying companies.
Administrative Fee Exemptions
Certified startups are exempt from notarial and registry fees during incorporation, and benefit from waived fees for certain administrative procedures. These are minor savings compared to the tax incentives, but they reduce the friction of setup for early-stage companies with limited capital.
Spain Startup Visa: How It Works for Non-EU Founders
The startup visa is one of the most asked-about elements of the Startups Law. It provides a dedicated immigration pathway for non-EU founders who want to establish an innovative business in Spain, distinct from the general entrepreneurial visa route that existed before the law. There are two options depending on where the applicant is when they apply.
| Factor | Startup Visa (outside Spain) | Residence Permit (in Spain) |
|---|---|---|
| Where to apply | Spanish Consulate in country of residence | Large Business and Strategic Groups Unit (UGE-CE) |
| Duration | 1 year | 2 years, renewable for another 2 |
| Decision timeline | 10 working days | 30 working days |
| Minimum capital | None required | None required |
| Jobs to create | None specified | None specified |
| Family members | Spouse, minor and dependent children, dependent parents can be included | Same; applications for family can be processed simultaneously |
Should I Incorporate First or Apply for the Visa First?
This is the most frequent practical question we receive from non-EU founders. The answer depends on where you are when you start.
If you are outside Spain, the startup visa exists precisely to allow you to enter Spain to make the preparatory arrangements for the business, including company formation. You do not need an incorporated company to apply for the visa. You need a credible business plan demonstrating the innovative character and economic value of the project. The visa gives you one year to set up; the company formation happens during or after that period.
If you are already in Spain on another legal basis, you apply for the residence permit instead, and here the company may or may not already exist depending on your situation. Many founders who are already operating informally or are in Spain on a student or employee visa apply for the residence permit once they are ready to formalise the project.
In practice, the visa and the ENISA certification application can run in parallel with the company formation, since they share the same underlying documentation: the business plan is the core document for all three processes. Starting them sequentially rather than simultaneously is the most common reason the overall timeline extends beyond what it needs to be.
Assessment Process: What DGCOMINVER Evaluates
The assessment of startup visa and residence permit applications is conducted on a case-by-case basis by the Directorate-General for International Trade and Investments (DGCOMINVER). There is no automatic approval: the project is evaluated by business experts against specific criteria, and a report on entrepreneurial activity is required from the Spanish Economic and Commercial Office in the country where the visa is being requested.
The evaluation covers three main areas: the founder’s profile, including training, professional experience, and personal involvement in the project; the business plan, which must describe the activity, start date, location, projected legal form, economic impact, estimated jobs, promotion strategy, and product or service with its innovative aspects; and the added value for the Spanish economy, including a market analysis covering competitors, potential consumers, and supply and demand.
The documents required include a valid passport, health insurance with a provider operating in Spain, background checks, proof of sufficient financial resources, and the report on entrepreneurial activity or business plan depending on whether a visa or residence permit is being requested.
The startup visa is assessed on the project’s innovative character and economic value, not on the founder’s nationality or capital. In our experience, the applications that are rejected or delayed are almost always ones where the business plan is generic rather than specific about the innovation, the market, and the economic case for Spain. The assessment is substantive, not administrative.
How to Open a Startup in Spain: Steps
The process for setting up a startup in Spain combines standard company incorporation steps with the specific certification and visa procedures introduced by the Startups Law. The two tracks can run in parallel to reduce overall timeline.
- Verify eligibility under the Startups Law. Confirm that the company meets all criteria for innovative character, revenue cap, age, and registration. Prepare the ENISA certification application simultaneously with company formation, since the two processes are independent and can run in parallel.
- Obtain identification documents. All founders require a Spanish NIE (Número de Identificación de Extranjero). If a foreign company is a shareholder, that company must obtain its own Spanish NIF before the incorporation deed can be signed. This is frequently the step that delays the overall timeline.
- Incorporate the company. Qualifying startups using standard bylaws can use the CIRCE online platform for fast-track incorporation, with notarial and registry fees waived. Companies with customised bylaws follow the standard notary and Commercial Registry process. Choose between an S.L. or S.A. depending on the shareholder structure and future capital needs.
- Apply for the startup visa or residence permit (non-EU founders only). The visa application is submitted to the Spanish consulate in the country of residence. The residence permit application is submitted to the UGE-CE. Both require a business plan and evidence of the project’s innovative character. Processing takes 10 working days for the visa and 30 working days for the residence permit.
- Register for tax, VAT, and social security. Obtain the definitive NIF, register for corporate income tax and VAT, and register for social security if the company will employ staff or the founder will work through the company as autónomo.
- Activate the preferential tax regime. Once ENISA certification is granted, the 15% corporate tax rate applies automatically from the first year in which taxable income is reported. Maintain documentation of the company’s innovative character throughout the certification period.
Spain Startup Ecosystem: Key Hubs
Spain’s startup ecosystem is geographically decentralised, with each major city developing distinct specialisations. Understanding where a startup fits within this ecosystem matters both for talent recruitment and for access to relevant investors and accelerators.
Europe’s top tech and SaaS hub. Home to Typeform, Wallapop, and the Mobile World Congress. Strong in deep tech, mobile, and international talent.
Financial capital and highest concentration of VC. Enterprise tech, fintech, and the headquarters of major Spanish and international corporate groups.
Rapidly emerging as a southern European tech hub. Google’s Tech Hub, Amazon Web Services, and the Sparkco incubator are anchoring a growing startup cluster.
Strong community-driven ecosystem. Lanzadera, backed by Mercadona founder Juan Roig, has accelerated over 700 startups and is one of Spain’s most active incubators.
Funding for Startups in Spain: Which Sources Are Actually Realistic for Foreign Founders?
Spain has a substantial public and private funding ecosystem. The problem for foreign founders is that several of the most visible sources have eligibility constraints that are not obvious from the outside. We generally recommend mapping funding by accessibility before investing time in applications, because the preparation required varies significantly and some instruments are simply not available to foreign-owned startups.
Accessible Immediately (Before or During Incorporation)
- Angel investment (private): The Startups Law’s 50% investor deduction for individuals investing up to €100,000 in certified startups has increased angel investment activity. Foreign-owned startups can access this channel once ENISA certification is in place. No Spanish shareholding requirement.
- EU Horizon Europe grants: Available to Spanish-registered entities regardless of shareholder nationality. Competitive and requires significant preparation, but accessible to foreign founders from day one of registration.
- Venture capital: Spanish VC funds, including Kibo Ventures, K Fund, Samaipata, and Seaya Ventures, invest in foreign-founded companies. Madrid and Barcelona both have active VC ecosystems. No nationality requirement, though network access matters practically.
Accessible After Incorporation and ENISA Certification
- ICO financing lines: Spain’s official credit institution provides financing for businesses with longer payback horizons, distributed through commercial banks. Available to incorporated companies regardless of shareholder nationality. Requires a business bank account in Spain.
- CDTI grants (NEOTEC programme): Partially repayable grants for technology-based startups. Competitive but accessible to foreign-owned companies. Requires an incorporated entity and a credible R&D plan.
- Lanzadera and Demium: Accelerator programmes with seed funding components. Open to foreign founders. Lanzadera is particularly active in Valencia; Demium operates across multiple cities. Acceptance is competitive and typically requires physical presence.
Accessible Only with Spanish or EU Majority Shareholding
- ENISA participative loans: Despite being the agency that certifies startup status, ENISA’s lending programmes historically require majority Spanish or EU shareholding. Foreign-owned startups with a non-EU majority shareholder typically cannot access ENISA loans directly, even after certification. This is one of the most frequently misunderstood constraints in the Spanish startup funding landscape.
- Some regional grants: Regional programmes (Catalonia, Madrid, Basque Country) vary significantly in their eligibility rules. Some require local majority ownership or minimum local employment thresholds that foreign-owned startups may not initially meet.
Fast-track incorporation takes six hours. The preparation that makes it go smoothly takes longer.
Lawants handles startup incorporation in Spain alongside the ENISA certification process, NIE and NIF applications for foreign founders and shareholders, and startup visa documentation, so the legal and immigration tracks run in parallel rather than sequentially.
Ranked among the Best Law Firms Spain · Offices in Barcelona and Madrid
Managing Director, Lawants
Response within 24 business hours
Why Foreign Founders Open Their Startup in Spain with Lawants
Most foreign founders who contact us about opening a startup in Spain arrive with the same two questions: does the Startups Law apply to their business, and what does the setup process actually involve? In our experience, the first question is answered correctly less often than founders expect. The law’s innovative character requirement is substantive, not formal, and the gap between “I think we qualify” and “ENISA has confirmed we qualify” is one that affects both the tax position and the visa pathway.
We regularly see founders who build their financial model around the 15% startup tax rate before ENISA certification has been confirmed. When the certification is not granted, or is granted for a shorter period than expected, the entire financial plan needs to be revisited. Verifying eligibility is not a formality we do after incorporation. It is the first thing we do.
Lawants works exclusively with foreign companies and entrepreneurs in Spain, with lawyers and tax advisors under one roof. For a startup, that matters because the legal setup, the tax certification, and the visa process are not independent tracks: they share documentation, they share timelines, and a decision made in one affects the others. The startup visa business plan is the same document that supports the ENISA application. The corporate structure chosen at incorporation determines which tax incentives apply and how investor equity is structured.
Most founders think they are opening a company. In reality, they are building the legal structure their startup will live with for years. The company can be incorporated in hours. The preparation cannot.
Getting the startup law benefits requires more than incorporating a company. It requires preparing for certification before the company exists.
Lawants accompanies foreign founders through the full startup setup process: eligibility assessment, ENISA certification, incorporation, startup visa or residence permit application, and ongoing tax compliance. One point of contact for every track that runs in parallel.
FAQ: Startup in Spain
The questions below come up most often when foreign founders are deciding whether to open a startup in Spain and how the Startups Law applies to their situation.
What is the Startup Law in Spain?
Law 28/2022 (Startups Law) came into force in January 2023. It introduced a 15% corporate tax rate for qualifying innovative startups (for the first four years of profitability), a 50% investor deduction for angel investors up to €100,000, improved stock option conditions with a €50,000 annual exemption, fast-track incorporation using standard bylaws, and a dedicated startup visa pathway for non-EU founders. Companies must be certified by ENISA to access the tax benefits.
How do I qualify as a startup under Spanish law?
To qualify, the company must be incorporated within the last five years (seven for strategic sectors), have its registered office or permanent establishment in Spain, not have distributed dividends, not be listed on a regulated market, not exceed €10 million in annual revenue, and have an innovative character assessed and certified by ENISA. The innovative character assessment is the most selective criterion and is evaluated on a case-by-case basis.
What is the Spain startup visa and who can apply?
The startup visa is available to non-EU nationals who want to establish an innovative business of particular economic interest in Spain. Applicants outside Spain apply at the Spanish consulate and receive a one-year visa, with a decision in 10 working days. Those already in Spain apply for a two-year residence permit at the UGE-CE, with a decision in 30 working days. No minimum capital or minimum job creation is required. Family members can apply simultaneously.
How long does it take to open a startup in Spain?
The company itself can be incorporated in as little as six working hours using standard bylaws via the CIRCE platform, with notarial and registry fees waived for qualifying startups. In practice, the total timeline depends on the NIE and NIF applications for founders and foreign shareholders, which typically take longer. The ENISA certification process and the startup visa are separate and run in parallel; the visa decision takes 10 to 30 working days depending on whether a visa or residence permit is requested.
What is the corporate tax rate for startups in Spain?
Qualifying startups certified by ENISA pay corporate income tax at 15% for the first four years in which taxable income is reported, against the standard rate of 25%. Companies can also defer tax payment for the first two years without interest or guarantees. The 15% rate applies automatically once ENISA certification has been granted and the company begins reporting taxable income.
Can a foreign company or non-EU founder open a startup in Spain?
Yes. There are no nationality restrictions on startup incorporation in Spain. A foreign company can be the sole shareholder of a Spanish S.L. (as an S.L.U.), and non-EU founders can apply for the startup visa or residence permit under the Startups Law. The foreign corporate shareholder must obtain a Spanish NIF before the incorporation deed is signed. Non-EU individual founders can apply for the visa and residence permit simultaneously with the incorporation process.
