Portugal vs Spain
Spain is £937 cheaper in year 1 and £850 a year cheaper after that.
| PortugalLda | SpainSociedad Limitada (SL) | |
|---|---|---|
| Costs | ||
| Minimum, year 1 | £1,440 | £503 |
| Minimum, per year after | £1,130 | £280 |
| Typical year 1 | £2,640 | £2,569 |
| Government fee | £310€360 Empresa na Hora | £85From about €97 (name certificate, registry and BORME) |
| Indirect setup | £130–1,030 | £138–1,415 |
| Running per year | £1,130–2,930 | £280–3,135 |
| Share capital | €1 per partner | €1 |
| Rules | ||
| Directors | No local directorYou need a tax number (NIF) and a tax representative. | No local directorEvery foreign director and shareholder needs a tax ID (NIE). |
| Remote setup | Through a providerOnline only with a Portuguese digital ID. Otherwise in person or through a lawyer. | Through a providerSign at a notary in Spain or by power of attorney. You also need a Spanish registered address. |
| Audit | No audit below size thresholds | No audit below size thresholds |
| Time to form | 1 day to 2 weeks | 2 to 4 weeks |
| Ease for foreign owners | 3/5 | 2/5 |
| Tax and banking | ||
| Corporation tax | 15% / 19%19%, or 15% on the first €50k for small companies, plus up to 1.5% municipal tax. | 19% / 25%25%. Companies with turnover under €1m pay 19% on the first €50k and 21% above. New companies pay 15% in their first two profitable years. |
| Dividend withholding | 25%25% dividend withholding, reduced by treaty. | 19% dividend withholding, 10% for UK residents. |
| VAT / GST | 23% | 21% |
| Banking | 2/5Local banks often want a visit. | 2/5You need a Spanish bank certificate for the capital deposit. |
| All company setup fees in Portugal | All company setup fees in Spain | |
Questions
Is Portugal cheaper than Spain for company setup?
No. Spain is cheaper, at least £503 in year 1 against £1,440 for Portugal.
Which is cheaper to run each year?
Spain, at least £280 a year against £1,130 for Portugal.
Which needs a local director?
Neither. You can run a company in either without a local director.
Which is faster to set up?
Portugal, in 1 day to 2 weeks. Spain takes 2 to 4 weeks.
How does corporation tax compare?
Portugal: 19%, or 15% on the first €50k for small companies, plus up to 1.5% municipal tax. Spain: 25%. Companies with turnover under €1m pay 19% on the first €50k and 21% above. New companies pay 15% in their first two profitable years.
Sources: Portuguese Government · PwC · Legalitas · Ayuda T Pymes · Taxfix