4.4 +5

Increase of the deduction percentage in the Personal Income Tax (IRPF).

International scale

Favourable treatment for carried interest

In case of any interest from any VC investor, be ready to sign a confidential agreement

The shareholders are responsible for the company’s debt with all their assets, Start-up

A start up is listed on the stock exchange.

Owned by shareholders who invest money in the business by buying shares of stock.

Property and management of the firm belong to individuals or legal entities.

Self-employment is never confused with freelance activity.

the law allows a limited liability firm S.L. to be set up with one euro of share capital

The transition period where the newly formed corporate government of the company that will implement the business plan

Property and management of the means of production belong to the public entity.

VC investor doesn't need to understand ifthe potential ofgrowth of the start-up is high&the associatedrisk canbe managed

Procedure of creation of a new Company: example in Spain step 1

Min. 60.000 eur, without máximum. The capital is devided in shares

Initial capital-Min. 3.000 eur - max. 120.000 eur. The capital is devided in participations.

Placefor entrepreneurs to obtain all the in4mation related 2 entrepreneurship in coordination w the restofthe admins.

The shareholders are responsible for the company’s debt with only in regard with the contributed sums

formed to serve some public purpose rather than for financial gain.

The owner is personally and unlimitedly liable for all debts and obligations of the business.

Self-employed Proprietorship is simplest & most popular type of ownership

Legal forms and aspects of a start-up/ firm possible classifactions

Family owned business: categories

A legal entity that is entirely separate from the parties who own it.

Laura’s clients give her instructions and check the results weekly It looks like Laura has multiple temporal jobs atonce

Low contribution of self-employment to the national economic performance in many countries.

a business owned and controlled by those who use its services.

Prospection: Recommendable to examine the website of each VC company for +information abt their investing strategy

It does not distribute or has not distributed dividends (returns in the case of cooperatives)

Various firms with different productive processes are grouped for more diversification and less risks.

Still relatively easy and inexpensive.

A presentation of the binding offer on behalf of the VC investor is the final step of negotiation

Procedure of creation of a new Company: example in Spain, step 3

By size:

Favourable tax treatment for stock options. This is a formula that rewards a company's employees with…

Main advantages: the limited liability and easier access to financing.

Visa for digital nomads allows foreigners to work from Spain under a more beneficial tax regime they pay non-resident t.

Open corporation, other partners are allowed to enter more easily than in “S.L."

No profitmaking intention, moral compensation start-up

By legal form…

Most used legal forms in Spain

Tax is 15%, instead of 25% for a maximum of 4 from the first period in which the taxable income is positive.

“Sociedad Limitada, S.L.” (limited liability): Nº of founders Min. 1, without maximum

Profits in the business are subject to individual income tax of the owner (entrepreneur).

Stages: (2) Prospection: Screen the capital market to find potential VC funds or companies;

Nº of founders Maximum 5

Self-employed business comprises only selfemployed workers and directors of limited companies without employees

Easiness for foreign investors. International investors providing capital to a startup company need to apply for

By Territorial extension…

Procedure of creation of a new Company: example in Spain, step 2

(Society). A collective entity, as a typical company

New incentives are created for business angels and founding partners with the aim of boosting investments

when the family-owned existing company decides to start a new business which might create synergies w the main business

A due diligence offers the investor the possibility to check the legal, fiscal and administrative documentation

Coexistence of both types of property

By The form of property…

Various firms that do the same productive process are grouped.

Liability: Joint and several liability (“solidaria”), limited to the capital contributed

Type of liability: unlimited or limited

controlled test spaces ('sandboxes'), where start-ups can test the viability and impact of technological innovation

Activity run in one town/city.

A start-up is a company that: is no more than five years old (seven if it belongs to strategic sectors like energy)

By Sector…

A complete control over the business (total decision-making authority).

Carlos controls what his company produces and sells and doesn’t get instructions from his clients how and what to do.

By The pursued purposes…

Private individual start-up

Integration level

The easiest and cheapest type of business to start with.

: As long as the start-up status is maintained, the tax rate for Corporate Income Tax and Non-Resident Income Tax is

Stages: (4) Negotiations .The final contract should not be discussed

a start-up company can be registered in the Mercantile Register within 6 working hours.

business dimension in which the family leaders the strategy decision making and financial structure of the venture

A start up is not an innovative company with a scalable model.

Stages: (3) Contact with investors: The business plan is studied by the investors during several weeks

Procedure of creation of a new Company: example in Spain, step 4

Activity run in a region.

Its annual turnover does not exceed ten million euros. At least 60% of its workforce has an employment contract in Spain

Procedure of creation of a new Company: example in Spain, step 4

Activity run across the country.

By Property…

a type of public limited-liability company regulated under EU law.

the maximum deduction of IRPF base for investing in start-ups increases from 60,000 to 100,000 euros per year.