Obligations of inactive companies in Spain

In Spain, there are many inactive registered companies, whose managers decide not to liquidate them and instead keep them in anticipation of a possible reactivation or to avoid formalities and expenses involved.

The decision to leave a company dormant must be approved at a general meeting. Nonetheless, the company continues to be subject to a number of obligations to the Spanish Tax Agency, Social Security and the Commercial Registry.

Obligations to the Tax Agency

  • Communicate to the Spanish Tax Agency (AEAT) that the company is inactive
  • Taxable persons subject to taxation of companies that are inactive retain their tax obligations, with the exception of the presentation of corporate income tax
  • From the date of inactivity, VAT is not deductible

Obligations to Social Security

Administrators who do not perform any other activity may unsubscribe from the Social Security in the Special Regime for Autonomous Workers (RETA).

Obligations to the Commercial Registry

The company will continue to be required to perform all the procedures conducted when it was active: the keeping of accounts and the legalization of deposit books and financial statements. Inactivity does not exempt the company from submitting the financial statements and failure to comply will result in a fine of 1,200 to 60,000,- €.

After a year of inactivity, the process to proceed in the dissolution of the company should occur and it will be the responsibility of the administrators of the company to convene the General Meeting within two months.

If the dormant company had a debt with the government, responsibility for non-payment of the debt shall lie with the managers.

This article is not considered as legal advice

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