In Spain, a Limited Company (SL, in Spanish) is a particular type of commercial company, which is commonly used to group a small number of partners, although in practice, there is no maximum number.
The Limited Company starts up with a minimum of €3.000 of capital, as set forth in Spanish legislation.
What are the main characteristics of a Limited Company in Spain?
Limited companies in Spain are regulated by the Capital Companies Law (Royal Legislative Decree 1/2010, of July 2).
As we have already mentioned, the main characteristic of a Limited Company (SL) is that it requires €3.000 capital to be incorporated among all the partners.
The minimum number of partners is 1, and there is no maximum number (in the case of SecondPROP, there is a maximum of 8). All of them have joint and several limited liability exclusively to the capital contributed.
In addition, all the share capital of the Limited Company is divided into “corporate shares,” which we will explain in detail later.
Regarding tax obligations, an SL must pay corporate tax and VAT.
Why do we use a Limited Company to buy the houses in secondPROP?
When you buy a share of a house in secondPROP, you become part of a Limited Company where your contributed capital is the corresponding part of that house.
For example, if it is a house worth €800.000 and you have acquired a share of 8, you would be participating in the SL with a contribution of €100.000.
The incorporation of the SL allows each owner to legally enjoy the part of the house acquired without any risk of conflict with other owners.
For example, if in a few years you want to sell your stake in that home, you can do so without any problem, and at the price of the real estate market at that time.
At secondPROP we take care of all the procedures for the incorporation of the SL
To incorporate a Limited Company, you must register the name of the company, prepare and present the bylaws, manage the public deed of incorporation before a notary public, open a bank account of the SL, and register the company in the Commercial Registry, etc.
There are many procedures that must be carried out to set forth a Limited Company. At secondPROP, we take care of everything: once the participants are found, we carry out the necessary steps, from start to finish, so that you can enjoy your second home with all the guarantees.
Our formula is 100% transparent: we create a Limited Company formed by the proprietary partners with the corresponding parts of capital and participation. At secondPROP, we are not part of the SL as such, nor we have any percentage of ownership over the homes.
