🇪🇸 EOR Guide —
Spain
Everything you need to know about using an Employer of Record in Spain — provider fees, compliance risks, hire speed, and EOR vs direct employment.
Employer SS (approx)
~30% of gross salary
Minimum wage (SMI 2025)
€1,134/month (14 payments)
Minimum annual leave
22 working days
Notice period
15 days (statutory minimum)
Severance (objective)
20 days/year (max 12 months)
EOR providers active
Deel, Remote, Papaya, Oyster
Our Recommendation
EOR recommended for first Spanish hires
Spain combines high employer social security costs (~30%) with complex collective agreements and significant termination costs. EOR is strongly recommended for the first 1–10 hires. The mandatory severance of 20 days per year of service on dismissal is a significant cost to plan for.
EOR provider fee range for Spain
Rates vary by provider, headcount, and benefits scope. Always request itemised quotes from at least three providers.
EOR vs Direct Employment
EOR advantages in Spain
- Hire in days
- Provider navigates convenios colectivos
- No Spanish entity required
- Provider manages mandatory severance accrual
EOR limitations in Spain
- 11–18% markup on high employer cost
- Collective agreement must still be determined
- Less control over employment terms
Direct employment advantages
- Full entity control
- No markup at scale
- Direct access to collective agreements (convenios)
Direct employment limitations
- SL setup takes 4–6 weeks
- High employer SS (~30%)
- Complex termination process with mandatory severance
Local Entity Options
Setting up a legal entity in Spain.
If you outgrow EOR or prefer direct employment, these are the main legal structures available in Spain for foreign companies.
Sociedad de Responsabilidad Limitada (SL)
Setup time
14–30d
Est. cost
$3,500
Min. capital
None
Corp. tax
25%
Div. WHT
19%
VAT rate
21%
Annual obligations
- Annual accounts (Registro Mercantil)
- IS corporate tax return (AEAT)
- IVA returns (monthly/quarterly)
- Modelo 111 payroll withholding
- Social Security declarations
Overview
Main corporate structure in Spain. Minimum share capital EUR 3,000 (fully paid up at formation). At least 1 administrator (no residency requirement). Registered office in Spain required. Notarial deed required (adds cost and time). Registro Mercantil registration. Corporate tax 25% (15% for first 2 years for new companies). VAT 21% — no registration threshold (mandatory from first transaction). Social security employer contributions ~30% of gross salary. Spain offers a patent box regime (60% exemption on IP income).
Branch (Sucursal)
Setup time
2500d+
Est. cost
—
Min. capital
$42
Corp. tax
25%
Div. WHT
19%
VAT rate
21%
Annual obligations
- Annual accounts of parent (Registro Mercantil)
- Corporate tax return
- IVA registration
Overview
Foreign companies can register a branch (sucursal) in Spain. Notarial deed and apostilled parent documents required. Registro Mercantil registration. No separate legal entity — parent fully liable. Branch profits subject to Spanish corporate tax. Must have a fiscal representative in Spain. Annual parent accounts must be published.
Compliance Risks
Key EOR compliance risks in Spain.
Discuss each of these with your chosen provider before signing.
Mandatory severance (indemnización)
HighEmployees dismissed for objective reasons receive 20 days salary per year of service (capped at 12 months). Unfair dismissal awards 33 days per year.
Convenios colectivos
HighSector collective agreements in Spain frequently set pay, hours, and benefits above statutory minimums. Your EOR must identify and apply the correct convenio for your industry.
High employer SS contributions
MediumSpanish employer contributions are among the highest in the EU at ~30% of gross salary. This significantly increases the true cost of employment.
Working time records (registro horario)
MediumSince 2019, all employers must keep daily working time records for every employee. Non-compliance carries fines.
Cost Estimator
Estimate your Spain EOR cost.
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