Grupo Asegi analyses each case to determine the optimal moment for the move from self-employed worker to Sociedad Limitada in the Basque Country. In general, when annual net profit exceeds €40,000-50,000, the SL starts to be more tax-efficient than remaining self-employed under the Basque foral regime.
Why moving from self-employed to SL in the Basque Country is not the same as in common territory
The Basque foral regime applies rates and deductions to Corporate Income Tax that differ from the Spanish common regime. This means that calculating when it is worth setting up an SL in Bizkaia, Gipuzkoa or Araba involves parameters of its own, which cannot be transferred mechanically from Madrid or Barcelona.
Under the foral regime, deductions for R&D&i, job creation and certain reserves are significantly more generous than under the common regime.
From what net profit is it worth considering the change
The €40,000-50,000 net profit threshold
As a general rule, when a self-employed worker invoices between €80,000 and €100,000 a year with a net profit of €40,000 to €50,000, it is worth carrying out the financial and tax analysis of the change to an SL.
Below that threshold, in most cases remaining self-employed is still more tax-efficient. Above it, the SL usually wins.
Cases where it is NOT worth it
- Activities that cannot easily be separated from the individual (liberal professions with personal professional registration).
- Businesses expected to be sold or wound down in the short term.
- Self-employed workers who need all of their income for personal expenses.
- Cases with potential partners who differ greatly in contribution or in risk.
Differences in taxation: personal income tax (IRPF) vs foral Corporate Income Tax
| Concept | Self-employed (IRPF) | SL (foral Corporate Income Tax) |
|---|---|---|
| Tax rate | Progressive 23%-49% depending on the band | Flat rate (general 24%, reduced for SMEs) |
| Deductions | Limited to the self-employed worker’s expenses | Broad: R&D&i, employment, investment, training |
| Liability | Personal and unlimited | Limited to the capital contributed |
| Social Security contributions | Self-employed contribution scale | Company director + employees |
| Distribution of profits | Everything is taxed under IRPF | Profits can stay in the company or be distributed |
| Image before clients | Individual professional | Company with a CIF and a structure |
Cost and process of setting up an SL in Bilbao, San Sebastián or Vitoria
The total cost of setting up an SL with professional advice is around €700-1,500, not counting the share capital, whose legal minimum has been €1 since the “Crea y Crece” Act (although contributing €3,000 is usually recommended).
The full process takes between 2 and 4 weeks, from the application for the company name to the final tax registration with the corresponding Foral Tax Authority.
Common mistakes when making the transition
- Continuing to invoice as a self-employed worker while the SL is already operating, creating tax duplications.
- Failing to transfer clients and contracts properly to the new CIF.
- Not deregistering as self-employed at the right moment, and so paying double contributions.
- Forgetting to change the bank direct debits and to amend the ownership details in the official registers.
- Not planning the director’s remuneration, which creates problems with the Social Security system and the Foral Tax Authority.
How Grupo Asegi handles it (step by step)
- Financial and tax analysis of the client to confirm that the change pays off in both tax and operational terms.
- Design of the optimal corporate structure (simple SL, SLU, asset holding company).
- Turnkey incorporation: company name, articles of association, notary, Commercial Register of Bizkaia/Gipuzkoa/Araba.
- Tax registration with the corresponding Foral Tax Authority.
- Handling the deregistration as self-employed and the transition of contracts.
- Implementing TicketBAI from the outset.
- Tax and accounting support through the first financial years.
Frequently asked questions
- How much does it cost to set up an SL in Bilbao?
- Between €700 and €1,500 in professional fees. The minimum legal share capital is €1 under the Crea y Crece Act (although contributing €3,000 is usually recommended), and that money stays in the company, so it is not a real cost.
- How long does it take to move from self-employed to SL?
- The full process takes between 2 and 4 weeks: company name, deposit of the share capital, notarial deed, registration with the Commercial Register and tax registration with the Foral Tax Authority.
- Do I have to close my self-employed activity first?
- No. The usual approach is to overlap for a few days so that clients and contracts move across in an orderly way.
- Does an SL always mean paying less tax?
- No. Below €40,000-50,000 of net profit, an SL is usually less tax-efficient than remaining self-employed.
- What documents do I need in order to set up the SL?
- DNI/NIE of the partners and directors, the share capital (legal minimum €1, recommended €3,000), a defined corporate purpose and a company name approved by the Central Commercial Register.
General information only; it does not replace professional advice. Foral legislation changes frequently — check the date it was last updated.