Setting up a business in Spain from France: the complete 2026 guide

For a French entrepreneur, Spain combines practical advantages — proximity, shared Mediterranean culture, access to Latin American markets — with fiscal incentives that the French system cannot match: a 4% IS rate in the ZEC Canarias, a flat 24% income tax under Beckham Law, and a 95% exemption on dividends from foreign subsidiaries. But these benefits only materialise with correct structuring from day one.

Why Spain for the French entrepreneur in 2026

Structural advantages:

• SL formation in 24-72 hours via CIRCE, minimum capital €1
• ZEC Canarias: 4% IS, registration deadline 31/12/2026
• Beckham Law: 24% flat IRPF for 6 years for qualifying founders
• LIS Art. 21: 95% exemption on dividends from French subsidiaries
• Spain-EU VAT regime: identical to France but 21% standard rate vs 20%
• Access to Latin American markets: Spain as hub for Ibero-American expansion

Comparative table:

Choosing your structure in Spain

Option 1: Spanish Sociedad Limitada (SL)

The most straightforward option for operations centred in Spain:

• Separate legal entity, own NIF, limited liability
• IS at 25% (15% first 2 years, base ≤ €300,000, for new companies)
• Constitution via CIRCE: 24-72 hours
• Minimum capital: €1 (recommended minimum in practice: €3,000 for commercial credibility)

Formation process:

1. Company name check (Registro Mercantil Central — 24h)
2. French founder obtains NIE
3. Capital deposit or notary declaration for amounts < €3,000
4. Notarial deed of constitution
5. Registro Mercantil registration (5-10 working days)
6. Modelo 036 with AEAT for tax registration

Option 2: Autónomo RETA

For professionals operating under their own name:

• RETA monthly contributions: €230-590/month (estimated net income scale since 2023)
• Modelo 036 for activity registration
• ROI number for EU transactions
• Quarterly VAT (Modelo 303), quarterly IRPF advance payments (Modelo 130)
• No minimum capital, immediate setup
• Risk: unlimited personal liability

Option 3: Branch of French société

Extension of the French SAS/SARL in Spain:

• Notarial deed with translated and apostilled French corporate documents
• Resident legal representative required
• 25% Spanish IS on Spain-attributable profits
• French parent has joint and several liability
• Use case: market testing, temporary projects (< 2 years)

Option 4: Franco-Spanish holding

For entrepreneurs with an existing French entity:

French founder (resident in Spain, Beckham)
                    │
                    ▼
         SPANISH HOLDING SL
          ├── Spanish operating SL (100%)
          └── French operating SAS/SARL (100%)

Key fiscal flows:

• Dividends French subsidiary → Spanish holding: Convention 1995 Art. 10 max 15% French withholding → 95% exempt LIS Art. 21 → effective rate ~1.25% in Spain
• Sale of French subsidiary by Spanish holding: gain 95% exempt LIS Art. 21 → effective rate ~1.25%
• Dividends holding → French founder (Spanish resident, Beckham): 19% to 30% IRPF savings rate (Arts. 66 and 76 LIRPF) on Spanish-source income, or foreign-source exempt under Beckham

The permanent establishment trap for French entrepreneurs

This is the most expensive error French entrepreneurs make when expanding to Spain.

What creates a PE (Convention 1995 Art. 5)

1. Fixed place of business in Spain: office, factory, workshop, place of management
2. Construction project exceeding 12 months
3. Dependent agent: habitually concludes contracts in Spain on behalf of the French entity

The effective management risk

If you, as gérant or PDG of your French SAS, make all strategic decisions from your Spanish home:

• Board meetings in Spain
• Contracts signed from Spain
• Staff directed from Spain
• Business development conducted from Spain

The AEAT may conclude that the siège de direction effective (place of effective management) is in Spain, rendering the entire French société a Spanish IS taxpayer. This is particularly likely when the gérant is the only person in the company.

How to manage the risk

Documentation approach:

• Hold board meetings physically in France
• Sign contracts in France when possible
• Maintain an active French office address with genuine activity
• Employ staff in France who make operational decisions

Services contract approach: The Spanish SL (employer of the founder-director in Spain) provides management services to the French société at arm’s length prices. This creates a legitimate, documented relationship that separates the activities and limits the PE risk.

Advance ruling: Request a binding ruling (consulta vinculante) from the AEAT regarding the proposed structure before implementation. This provides legal certainty.

ZEC Canarias: the 4% opportunity before 31 December 2026

The Zona Especial Canaria is Spain’s most powerful fiscal incentive for new business formation: IS at 4% (vs 25% standard), available only to companies registered before 31/12/2026 (Art. 29.2 Law 19/1994, which ties registration to the validity of Regulation (EU) 651/2014, extended to 31/12/2026 by Regulation (EU) 2023/1315).

Why the deadline matters

After 31/12/2026, no new company can enter the ZEC regime unless the Commission extends or replaces Regulation 651/2014. Companies already registered keep the incentives for the six years after the Regulation expires (Art. 29.1 Law 19/1994). A French entrepreneur who misses this window loses the most competitive IS rate available in the EU.

ZEC requirements

The ideal French ZEC company

A French-founded digital services or consulting company with:

• European client base
• 5 jobs created in Gran Canaria or Tenerife (3 in the other islands) within six months
• An investment of at least €100,000 in fixed assets within two years (€50,000 in the other islands); no minimum share capital

Savings: 21 percentage points of IS on profits. On €500,000 annual profit: saving of €105,000/year vs standard Spanish IS.

Beckham Law for French founders

Since Ley 28/2022 (Startups Act), Beckham Law extends to three categories relevant to French entrepreneurs:

Category 1: Innovative entrepreneur (emprendedor)

• Form an innovative company with ENISA endorsement
• Modelo 149 within 6 months of Social Security registration

Category 2: Remote worker (nómada digital)

• Work contract with a non-Spanish employer
• 3+ months of pre-existing contract outside Spain

Category 3: Director of non-resident company

• Director of a company not resident in Spain
• Shareholding < 25%

Beckham advantages for French entrepreneurs

Critical note: Under Beckham, the founder retains Spanish resident status for Convention 1995 purposes (Art. 93.3 LIRPF). This means they can still invoke the Convention against France to avoid double taxation on French-source income.

EU VAT between Spain and France: key rules

B2B services: reverse charge (inversión del sujeto pasivo)

Under EU Directive 2006/112/EC Art. 44:

• Spanish SL → French business client: invoice without Spanish VAT (0%); French client applies autoliquidation (self-assessed French VAT at 20%)
• French SAS → Spanish SL: invoice without French VAT; Spanish SL applies inversión del sujeto pasivo (self-assesses 21% Spanish VAT)

Prerequisite: both companies must have active EU VAT numbers (ROI/numéro intracommunautaire) verified in VIES (ec.europa.eu/taxation_customs/vies).

ROI number: register before the first invoice

The ROI number is the Spanish EU VAT identifier (ES + NIF). Request when filing Modelo 036. Active before issuing the first intra-EU invoice. Without it: Spanish VAT (21%) may be wrongly applied and French client may refuse the invoice.

Intrastat and Modelo 349

• Modelo 349: quarterly (or monthly if > €50,000) declaration of intra-EU services and goods operations
• Intrastat: statistical declaration for goods > €460,000 in dispatches or arrivals

Transfer pricing with the French société

Intercompany transactions at arm’s length:

• Art. 18 LIS (Spain) + Art. 9 Convention 1995
• Written services agreement at market rate
• Documentation if group > €45M consolidated revenue
• Modelo 232 if transactions > €250,000 per year with a single related party

Annual compliance for the Spanish SL

Key filing calendar

The most common mistakes French entrepreneurs make in Spain

Mistake 1: No PE analysis before managing the French société from Spain Get a PE analysis before you land. Retroactive restructuring is vastly more expensive than proactive design.

Mistake 2: Missing the Beckham 6-month window Modelo 149 within 6 months of Social Security registration is an absolute deadline. Day 181 = Beckham permanently lost for this stay.

Mistake 3: No ROI before the first French client invoice A Spanish SL must have an active ROI number before issuing a B2B invoice to a French company, or Spanish VAT applies.

Mistake 4: Missing the ZEC 31/12/2026 deadline The date comes from Art. 29.2 Law 19/1994 and Regulation (EU) 2023/1315. After 31 December 2026, the 4% rate is unavailable for new entrants unless the Commission extends or replaces Regulation 651/2014.

Mistake 5: Inadequate transfer pricing documentation The intercompany services agreement and pricing policy must be in place from the first transaction. Post-hoc documentation is ineffective against an audit.

Mistake 6: Confusing Beckham with Convention 1995 interaction Beckham excludes foreign-source income from Spanish IRPF, but the founder is still a Spanish resident for Convention 1995 purposes. They can invoke the Convention against France — but the interaction between “no Spanish tax on foreign income” and “Convention credit method” requires careful analysis.

This document is for informational purposes only. It does not constitute tax or legal advice. Rules on permanent establishment, ZEC eligibility, Beckham Law conditions and Convention 1995 should be verified with qualified advisers (confirm DGT criterion on sole-resident gérant as PE and Art. 10 §2b zero-rate conditions for Franco-Spanish holdings ≥25% with a qualified cross-border specialist).