The Startups Law Project or entrepreneurs law Project is a plan approved at the end of 2021 that is specifically designed for emerging companies. According to the Government, this law is a «top priority», therefore, its effects will take effect before the end of 2022.
What is an emerging company?
An emerging company is one that has not been active for more than 5 years, extendable to 7 years in specific companies that belong to a strategic sector, for example: biotechnology, energy, industrial companies, or that have developed their own technological projects, have an innovative nature. Also their turnover does not have to exceed 5 millions euros.
What are the benefits?
Simplification of procedures:
One of the benefits granted by the startups law is the simplification on creating a startup company. This law will impose that some of the procedures entailed in the constitution of a startup will be free of charge. It is foreseen that these procedures can be carried out online.
Corporate income tax novelties:
- The corporate income tax rate is reduced from 25% to 15% in the 3 following tax years since the first positive taxable income is obtained.
- In addition, it will be possible to defer the payment of the corporate income tax in the 2 following years of obtaining a positive taxable income.
Income Tax novelties:
- It is raised the Income Tax deduction for the acquisition of shares or participations to 60%.
- Improvement on the special tax regime of the Income Tax, related to workers that were displaced from Spanish territory with the aim of “repatriating” talent. In other words, bringing back the talent to Spain that was lost by all those people who had to emigrate to other countries.
Stock options
The exemption on the delivery of “stock options” to employees has been extended up to 50,000 euros, deferring the taxation of the non-exempt portion until the startup is listed or the shares received are disposed of.
Social Security
For 3 years, is eliminated the obligation to pay double contributions for those entrepreneurs who additionally work as employees.
Foreign investors
it is not necessary to obtain a NIE for non-residents who want to set up a startup. Although if your intention is to live in Spain you will need a NIE for almost any procedure. You can read our article about the NIE by clicking here.
As you may have seen, this project brings multiple benefits for entrepreneurs. It can be said that it is the perfect time to open your business, so we remind you that we have an article that might interest you :The 7 types of companies that you can set up in Spain.
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