Buying a Property with a Company in Spain
Buying a home in Spain is not something that should be considered lightly. It is a very important decision, and if we add to this the bureaucracy and barrier, choosing a good lawyer will make a difference.
Perhaps it’s the right time and you have taken the decision to go ahead but what happens if you have a Ltd company in the UK and you are wondering whether to do the whole process through the company or not. Is it legal or feasible to do it that way?
The answer is yes. The Spanish laws, like in the rest of many countries, allow foreign companies to purchase properties where they can be added to the patrimony.
What are the advantages?
Foreign companies are not subject to Non Resident Taxes as they have to submit their tax declarations in the UK.
If the property is rented out or used for business purposes, it will mean that all incomes will need to be quarterly declared here in Spain with a 19% tax rate.
Also, if the administrator of the company was to pass away, there will not be inheritance taxes involved in Spain as there will be a transfer of the shares in the UK.
What do I need to provide to my solicitor?
There will be several documents that your solicitor will need to check and verify before proceeding further with the purchase. This is a list of the documents to be provided:
Certificate of incorporation
This certificate will show the entry date in the Companies House, full company name and number.
Memorandum of articles
It will show the company’s regulations, rights and obligations
Good standing certificate
This document will indicate the members, their position within the company, its address & date of where & when the company was registered, if it has the right paperwork in place and if there are any current actions taken against the company (i.e. liquidation, dissolution, etc.)
Annual Return (AR01)
The annual return details the current shareholders, the number of shares each holds, and the position within the company. This is very important in order to distinguish the members and their position in order to be able to carry out the purchase.
Power of Attorney
This document will enable us to act on behalf of the company in Spain.Most of the company’s information will be detailed in the power of attorney to avoid complications and any misunderstandings in the process. This is why is so important to provide the documents previously mentioned.
You can obtain all the company’s documentation at the Companies House : https://www.gov.uk/get-information-about-a-company. Once you have obtained it, you will need to find a Notary nearby https://www.thenotariessociety.org.uk/ as you will need to get them Notarised (verified by a Notary) and have them sent to the Foreign Office to be stamped with the Apostille of the Hague. You can normally get your local Notary to do this for you.Once these documents have been duly signed, verified and apostilled, they will need to be couriered to Spain as you lawyer will need to prepare the sworn translations to proceed.
When the sworn translations are ready, the ball will start rolling at this end to continue with the purchase procedure!
The next steps will be to obtain NIE certificates with their tax numbers for all the administrators, and once granted the company will need a tax number called CIF that your lawyer will also get for you.
It is a longer process than usual but you are in the right hands to ensure the job is done correctly!!!