Setting up an SL in the Canaries in 2026: the real steps, the €1 capital and how long it actually takes

The headline is true: since the autumn of 2022 a Spanish limited company — the sociedad limitada, or SL — can be formed with one euro of capital, and the law now promises a registration measured in hours. Both facts are real. Both mislead a founder who takes them at face value, because the euro comes with strings the law attaches on the next line, and the hours count only once every document is in order — which, for a founder who lives abroad or has just arrived in Tenerife, is the part that takes weeks. Here is the sequence as it actually runs from our office in Costa Adeje, step by step, with the law behind each one and the honest timeline at the end.

What "one euro" really means

The Companies Act now says that the capital of a limited company «may not be less than one euro» (Ley de Sociedades de Capital, art. 4.1), where it used to say three thousand. But the same article keeps two rules alive for as long as the capital stays under €3,000: each year at least 20 % of the profit must go to the legal reserve until reserve and capital together reach €3,000; and if the company is ever wound up, voluntarily or not, with assets that do not cover its debts, the partners answer jointly for the difference between €3,000 and the capital they subscribed. The old "successive formation" company that the 2013 law invented for the same purpose was abolished at the same time, and the few that still exist may switch to the new rule by amending their bylaws.

So the euro is a floor, not advice. A company that will rent premises, open a bank account and sign with suppliers presents better with €3,000 on its deed — the figure banks and counterparties still expect — and its founders carry no residual liability. What the reform did remove, together with a 2018 change, is the paperwork around the money: for a limited company the founders no longer need the bank's certificate of deposit if they declare in the deed that they answer jointly for the reality of the contributions (art. 62.2); and a contribution in kind — a vehicle, equipment, a domain and a brand — needs no independent expert's report, at the price of the founders answering for the value they put on it (art. 73).

The documents before the deed

Identity. Every founder and every director needs a Spanish tax number: the NIE for a foreign individual, a NIF for a foreign company that will hold shares. For a founder abroad this is the first clock that starts, and it runs at the consulate's pace. Foreign documents — a passport copy certified abroad, a power of attorney, a company extract — must carry the Hague apostille or diplomatic legalisation and a sworn translation into Spanish (Ley 14/2013, art. 15.3.a). The notary will also identify the beneficial owners — the natural persons behind more than 25 % of the shares — under the anti-money-laundering rules, and the company will keep declaring them, to the notarial database and to the central registry of beneficial owners, for the rest of its life.

The name. The Central Mercantile Registry issues a certificate that the name you want is not already taken; you may propose up to five names in order of preference, and through the electronic channel the certificate arrives within six working hours (art. 15.3.b). The certificate is valid for three months, the name itself is reserved for six (Reglamento del Registro Mercantil, arts. 412 and 414); no deed can be signed without it, and the name on the deed must match it exactly (art. 413).

The bylaws. The deed must contain the founders, their contributions, the shares each receives, the bylaws and the first directors (Ley de Sociedades de Capital, art. 22); the bylaws must fix the name, the objects, the registered office, the capital and its division into numbered shares, the system of administration and how the organs decide (art. 23). Two choices matter more than the rest. Who runs the company — a sole director, two or more acting jointly or severally, or a board — and the bylaws of a limited company may list several systems and let the partners switch between them without amending anything (art. 210). And how shares move: the default rule gives the other partners a right of first refusal, and founders who are not family often want it, or want it softened, before the first disagreement rather than after.

The registered office. The bylaws name a domicilio social, and the law wants it to be the place where the company's effective administration and management sit, or its main establishment. A business centre that provides the office, the meeting room and the mail — as ours does in Costa Adeje — is a lawful and common choice for a company run by owners who travel; a bare mailbox where nobody ever manages anything is not, and it is the tax office rather than the registrar that will one day ask.

The deed, the registry and the clocks

The signing takes place at a notary, and the law has built two express lanes through the CIRCE system and the Puntos de Atención al Emprendedor — notaries, mercantile registries and accredited offices that file the single electronic document, the DUE, on the founders' behalf (Ley 14/2013, art. 13).

With standard bylaws — the ministry's model, available in every official language — the timetable is written into the law: the name certificate within six working hours, a notary appointment fixed electronically within twelve working hours of starting the file, the deed signed in a standardised electronic format, the provisional tax number requested by the notary the same day, and the registrar's decision within six working hours of receiving the deed (art. 15.3 to 15.5). The registrar then requests the definitive tax number, and the publication in the official registry gazette is free of charge (art. 15.9). The notary's and registrar's fees for this lane are fixed by decree — a fixed €60 and €40 where the capital does not exceed €3,100 and the bylaws follow the approved model, €150 and €100 for other electronic incorporations (Real Decreto-ley 13/2010, art. 5) — to which the lawyer's work and the translations are added.

With bespoke bylaws — the usual choice when there are two or more founders, foreign partners or a shareholders' agreement behind the company — the registrar first records the company provisionally within six working hours, on its name, office, objects, capital and administration, and completes the full registration within five days; from the provisional entry the company is already governed by the Companies Act (art. 16.3 and 16.4). The company acquires legal personality with the registration (Ley de Sociedades de Capital, art. 33).

Until it does, the law has a name for it — the sociedad en formación — and a rule for whoever acts in its name. Contracts signed before registration bind jointly the people who signed them, unless made conditional on registration and later assumption by the company (art. 36); the company in formation answers with its own assets for the acts needed to register it and for those the directors were empowered to do (art. 37); once registered, the company is bound by those acts and by any others it accepts within three months, and the personal liability of founders and directors ends (art. 38). The practical reading: sign the lease and the supplier contracts after the registration, or make them conditional on it.

From the registration to the first invoice

A registered company is not yet a trading one. The steps that follow, in the order we run them:

• The definitive tax number and the census declaration — Modelo 036 with the State tax agency, declaring activity, premises and obligations.
• IGIC, not VAT. The Canary Islands sit outside the EU VAT area; the company registers for the Canary indirect tax with the Canary tax agency — Modelo 400 — and invoices with IGIC, at the general 7 % for most services. An SL that expects to bill mainland or EU clients needs this explained before its first invoice, not after.
• Social Security. A director who controls the company registers as a self-employed autónomo societario; a company that hires registers as an employer before the first contract.
• The municipal side. Premises open to the public need the town hall's activity communication or licence, in Adeje as anywhere else — the electronic channel can carry it with the same file (Ley 14/2013, art. 17).
• Foreign founders' declaration. A non-resident who takes 10 % or more of a Spanish company — the incorporation itself counts — declares the investment to the Foreign Investments Registry after the deed (Real Decreto 571/2023, art. 4.a). It is a statistical duty, not a permit: when a Spanish notary authorises the deed and is given all the data, the notary's own report to the Registry relieves the founder of filing it (art. 5.3.b); otherwise the founder files, in the form and within the deadline the ministry's order sets.
• Invoicing software and accounts. From 2027 every company's invoicing system must meet the VeriFactu standard — our guide to VeriFactu in the Canaries sets out the dates — and the annual accounts are deposited at the Mercantile Registry each year, with the beneficial-ownership declaration alongside.

The Canary Islands also offer two regimes that change a company's tax life and that a founder hears about on the first day: the special zone with a reduced corporate rate for qualifying companies with real substance and jobs, and the investment reserve that lets profits kept on the islands cut the tax base. Both are worth a conversation before the objects clause is drafted; neither is a reason to incorporate before the business plan exists.

How long it really takes

The law's hours are real, and a Spanish resident with a NIE, a bank account and standard bylaws can hold a registered company inside a week. For the founders we usually see — a couple moving from abroad, a partner still in Düsseldorf, a foreign parent company — the calendar is set by three things the law does not control: the NIE appointment at the consulate or the police, the bank and its identification checks for a non-resident shareholder, and the apostilled and translated documents travelling between two countries. In our experience that is three to six weeks from the first meeting to a company that can invoice, and most of it runs in parallel if the file is opened correctly on day one. A power of attorney signed at home, apostilled and translated, lets the whole sequence happen without a second flight.

A founder's checklist

• Decide the capital with the liability in mind: €1 is legal; €3,000 closes the founders' exposure and opens more doors.
• Start the NIE and the bank at the same time as the name — they are the long poles, not the registry.
• Choose the administration system and the share-transfer rule before the notary, and write the shareholders' agreement now if there is more than one of you.
• Use standard bylaws only if they fit; the hours they save are lost twice at the first amendment.
• Sign nothing in the company's name before registration unless it is conditional on it.
• Book the IGIC registration with the tax census — an invoice with the wrong tax is the commonest first mistake on the islands.
• Keep the deed, the certificates and the beneficial-ownership declaration in one file: every bank, notary and agency will ask for them again.

A company is registered in hours and built in weeks — the difference is whether the founder's own papers were ready first.

Our commercial team forms and restructures companies for owners across Tenerife and Fuerteventura — bylaws and shareholders' agreements, powers of attorney for founders abroad, the notary and registry sequence, the tax and Social Security registrations — in twelve working languages, with a registered office and meeting rooms available at our Costa Adeje business centre. Read how we work in commercial law, or tell us your project at our Costa Adeje or Corralejo offices.

Common questions

Can I really set up an SL with one euro?

Yes. Since the 2022 reform the minimum capital of a limited company is one euro. While the capital stays under €3,000, at least 20 % of each year's profit must go to the legal reserve until reserve and capital reach €3,000, and in a liquidation with insufficient assets the partners answer jointly for the difference between €3,000 and the capital subscribed. Most founders still choose €3,000.

How long does it take to register a company in Spain?

With standard bylaws the law fixes the clocks: the name certificate within six working hours, the notary appointment within twelve, the registration within six working hours of the deed reaching the registry. With bespoke bylaws the registrar records the company provisionally within six hours and definitively within five days. For a foreign founder the real timeline is set by the NIE, the bank and the apostilled documents — three to six weeks in practice.

Do I need a bank certificate for the capital?

Not for a limited company if the founders declare in the deed that they answer jointly for the reality of the contributions. A bank account is still needed to operate, and opening it is usually the slowest step for a non-resident shareholder.

Can a founder who lives abroad set up the company without travelling?

Yes, with a power of attorney signed before a notary at home, apostilled and translated by a sworn translator, and a NIE obtained through the consulate. Foreign public documents must carry the apostille or legalisation and a sworn translation to enter the file.

Can the registered office be a business centre?

Yes, provided the company is effectively managed there — an office, a meeting room and someone who receives and acts on the mail, not a mailbox. Our Costa Adeje business centre hosts the registered office of companies whose owners run them from abroad, and the tax office, not the registry, is the authority that will one day check that the address is real.

This article is general information about Spanish company law as it stands at the date of publication, not legal advice for your specific project. Fees, timetables and the practice of registries and banks move — have your incorporation planned with current figures before you sign.