# starting a business in costa del sol



## kazzerlodge (Oct 2, 2010)

Hi, I just need some advice please.

I am thinking of renting a premises on the costa del sol and would like to know if there are any taxes or other costs that I may not be aware of. I will not require a drinks of food license.


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## xicoalc (Apr 20, 2010)

Hi & Welcome!

Taxes and expenses associated with your business will depend on a number of things to be honest. Maybe you can give us a little more information on the type of business you are thinking of running.

In general, in Spain, if you are opening up a businesses from a premises you will need an opening licence which is applied for through your local Ayuntamiente (town hall). The cost of this varies on your area and what you are doing etc. Taking on an empty unit and starting something new will mean a whole application and this really could cost anything but for a ball part figure lets say 2,500 euroes (could be a lot more of a lot less).

You will then pay your automino social security (automino is self employed, assuming that is the way you operate, you may choose to become a "ltd" company, in which case things will differ). Currently, with a few exceptions the social security is about 250 euro per month. This will give you healthcare, and after 15 years of contributions the state pension. This is not optional, its compulsory.

You will then need to be registered for income tax and IVA (VAT). Unlike the UK there is no threshold for IVA, all businesses register for it, with a few exceptions, again this depends on the type of goods and/or services you are offering.

IVA works pretty much like the UK system. You charge the appropriate rate (usually 18%) on top of the goods you sell, this is collected by you and paid quarterly to the tax man. You can of course deduct the IVA element of all purchases made because this is "reclaimable".

Income tax is also calculated on a quarterly basis (give or take, allow 20% of bottom line profit). This is paid quarterly with an annual return also being completed to allow for any other claimable expenses etc. At the end of the year you square up with the tax man - pay any extra you are due to pay, or reclaim if you have overpaid.

There is another system for tax - modular. This is only applicable to certain businesses and does have an upper threshold, but basically you are assessed on how much tax you will pay based on the type of business you are and other factors (for example a restaurant will be charged based on the number of seats/tables they have). This is then a fixed tax amount you pay regardless of your actual takings. For some businesses it works extremely well and once you are on modulus you end up paying far less tax (because a few good months does not mean an increased tax bill), but obviously in some cases you can pay more - have a quiet month and the same rate of tax is due.

My advice regarding tax is always to consult with a good reputable Aesoria (accountant) who will look at your individual circumstances, type of business, anticipated turnover etc and give you the best advice on a) what structure/form your company should take, and b) what type of tax system to go onto (and of course, what your options are). Your Asesoria will also be able to help you with the paperwork to register for taxes and should take care of all the hassle for you.

Any advice or help you do need regarding starting up, planning, etc please feel free to PM me!

Good luck - I hope it all goes well for you!


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## mrypg9 (Apr 26, 2008)

kazzerlodge said:


> Hi, I just need some advice please.
> 
> I am thinking of renting a premises on the costa del sol and would like to know if there are any taxes or other costs that I may not be aware of. I will not require a drinks of food license.


Do you speak Spanish?
Have you knowledge of the area in which you intend to set up your business?
The economic situation is dire and seems set to get worse.
Many disillusioned British immigrants are heading for home.
Unemployment is over 30% in some areas.
But people are spending money - we shopped for new furniture yesterday at a medium to top priced store and we weren't the only customers.....
And some people are making money, in this area anyway.
Our 'good' local restaurants are full every night.


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## xicoalc (Apr 20, 2010)

mrypg9 said:


> But people are spending money - we shopped for new furniture yesterday at a medium to top priced store and we weren't the only customers.....
> And some people are making money, in this area anyway.
> Our 'good' local restaurants are full every night.


Agreed!


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## kazzerlodge (Oct 2, 2010)

steve_in_spain said:


> Agreed!


Hiya Steve, thanks for your advice, seems like theres alot to think about! 

My partner is probably the one to deal with all that side, I just have the ideas for the business!

Karen


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## xicoalc (Apr 20, 2010)

kazzerlodge said:


> Hiya Steve, thanks for your advice, seems like theres alot to think about!
> 
> My partner is probably the one to deal with all that side, I just have the ideas for the business!
> 
> Karen


what are you thinking of doing? pm me if you prefer!


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## kazzerlodge (Oct 2, 2010)

mrypg9 said:


> Do you speak Spanish?
> Have you knowledge of the area in which you intend to set up your business?
> The economic situation is dire and seems set to get worse.
> Many disillusioned British immigrants are heading for home.
> ...


No I dont speak spanish, I know a few words. I am willing to learn.

We are going to visit Mijas in November, to check the area out. We do have friends who run a bar on the costa del sol. We are going to get some advice off them too. 

Its not really a problem work wise. My partner is going to maybe work in their bar and come to England to work.....

I just had an idea about working for ourselves. I have a business idea in mind. I think I will need to do alot of research before even considering it.


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## kazzerlodge (Oct 2, 2010)

steve_in_spain said:


> what are you thinking of doing? pm me if you prefer!


I might sound really thick here, but I cant find how to PM????


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## xabiaxica (Jun 23, 2009)

kazzerlodge said:


> I might sound really thick here, but I cant find how to PM????


when you have 5 or more posts you can PM by clicking on the name of the person you want to PM


unless it's something really private though, it's nice to keep discussions on the open forum

after all - that's what the forum is for & the discussion might help someone else in future


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## kazzerlodge (Oct 2, 2010)

xabiachica said:


> when you have 5 or more posts you can PM by clicking on the name of the person you want to PM
> 
> 
> unless it's something really private though, it's nice to keep discussions on the open forum
> ...


Might sound a bit paranoid but my partner said its best not to put my ideas on here for everyone to see. Hope that wont offend anyone!


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## xabiaxica (Jun 23, 2009)

kazzerlodge said:


> Might sound a bit paranoid but my partner said its best not to put my ideas on here for everyone to see. Hope that wont offend anyone!


best not to tell *anyone* then


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## kazzerlodge (Oct 2, 2010)

xabiachica said:


> best not to tell *anyone* then


 thanks.


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