Why would you want to open a Gran Canaria business? Well, first of all, it has fantastic weather, allowing anyone to be able to do business 365 days a year, modern infrastructure, broadband internet, and a convenient location between four continents. Besides all these, there is no VAT. Instead, there is a local indirect tax called IGIC (Impuesto General Indirecto Canario, Canarian General Indirect Tax) which is 3%-7% on the majority of items.
There are important tax incentives for Gran Canaria businesses who:
- Invest in tangible assets (excluding plots of land), for the development of the economic activity of the business
- Invest in tangible assets that protect the environment
- Create new jobs
- Create new jobs for the disabled
- Set up industrial or manufacturing facilities
- Invest or spend in export activities
- Invest in research, development, and innovative technology
- Invest in IT or communication technology
- Belong to the transport sector and invest in modernizing it.
- Set up offices or companies in different countries, to help export products or sell tourist services in Spain. A minimum of 25% of the capital of the new companies must be owned by the Gran Canaria (or Spanish) company
- Spend on promoting products or services in international trade shows (this also includes those taking place in Spain)
- Spend on goods of cultural interest
- Invest in filmmaking
- Invest in publishing books
- Spend in training their staff
- Companies who contribute to the pension funds of their staff
- Invest in workers’ children’s day care facilities
Before one sets up or buys a business in Gran Canaria, he/she must be aware that Gran Canaria is rapidly recovering from a very deep recession, mainly due to the property bubble.
Here’s a list of businesses that are doing well:
Tourist sector: hotels, car rental companies, tourist attractions, etc.
Real Estate agencies specialized in vacation rentals
Internet businesses (good prospects, recommended)
Second hand shops like Cash Converters
Export (especially to the African continent) businesses
The average rents are as follows:
Retails shops: 500 euros up
Retail shops in shopping malls: 2000 euros and up
Offices: 300 euros and up, but if you want to start small, there are quality co-working spaces with reliable broadband internet, from where you can work, get advice, and pay an affordable fee.
To set up a Gran Canaria business, you will need the help of a qualified accountant, tax advisor, and labor advisor. All limited liability companies have to maintain proper accounts (according to the Plan General de Contabilidad, or General Accounting Plan, which is a set of standarized accounts and account numbers) , and submit them once a year to the tax authorities. Taxes have to be paid every quarter, and require papers to be filled in. Each worker hired or fired also requires certain paperwork to be done.
It takes a few weeks to set up a Gran Canaria business (limited liability). Here’s a summary of the things that have to be done and how long each takes.
1) Choose a company name and register it (3-5 days).
2) Open a bank account, and transfer money from your country to this account, if what you give as capital for the company is cash. This money will remain blocked until you finalize step number 7).
3) Public notary will prepare the company documents (2-3 days)
4) Documents have to be signed
5) Receive documents from the notary (4-5 days). Next day you can apply for a provisional CIF company registration tax number, and request the company to be set up legally
6) The company is registered in the commercial register (Registro Mercantil). (15-20 days).
7) Definite tax number is given to you. Take this number to the bank and unblock your account and start operating.
Now, if you are an independent professional or want to be self-employed, all the paperwork to open a Gran Canaria business can be finished in only 24 hours!!!!