Autónomo or SL? Starting a Business in Alicante and Málaga

Why this decision matters on the coast

Alicante and Málaga are home to Spain's two largest British communities, and thousands of expats start businesses there every year: holiday rental management, trades, beauty and wellness, bars and restaurants, consulting and online services. Choosing the wrong structure is one of the most expensive early mistakes: it affects how much tax you pay, your personal risk and your paperwork every quarter.

Working as autónomo

As an autónomo you register with the Tax Agency and Social Security and trade in your own name. It is quick and cheap to start and the bookkeeping is lighter.

• Tax: your profit is taxed through personal income tax (IRPF) at progressive rates. At higher profits the marginal rate exceeds 45%.
• Social security: since 2023, contributions depend on your real net income. New autónomos can usually pay a reduced flat rate of €80 a month for the first 12 months, which can be extended if income stays low.
• Liability: unlimited. If the business owes money, your personal assets, including your home, can be at risk.
• Paperwork: quarterly VAT and income tax returns, plus the annual income tax return.

Forming an SL

A Sociedad Limitada is a separate company. You own the shares and usually act as director.

• Tax: the company pays corporate tax. The general rate is 25%, new companies pay 15% in their first year with profit and the following year, and in 2026 small companies with turnover under €1 million pay 19% on the first €50,000 of profit and 21% on the rest. You then pay personal tax on the salary or dividends you take out.
• Liability: limited to the company's assets in normal circumstances.
• Costs: higher (formation, a fuller set of accounts, annual accounts filed at the Mercantile Registry, and, from 1 January 2027, VeriFactu-compliant invoicing software).
• Social security: a director who controls the company and works in it usually still registers as self-employed (autónomo societario).

Alicante and Málaga are not taxed the same

Part of personal income tax is set by each region. Alicante is in the Valencian Community and Málaga in Andalusia, and their regional rates and deductions differ: Andalusia has cut its regional rates in recent years. For an autónomo, or for the salary and dividends you take from an SL, the same profit can mean a different tax bill depending on where you live. We calculate it for your region, not with a national average.

Local rules that affect both options

• Holiday rentals: tourist lets must be registered with the regional tourism register (the Valencian register in Alicante, the Andalusian register in Málaga), and since July 2025 short-term rentals also need a national registration number to advertise on platforms.
• Premises: a bar, shop or clinic needs a municipal activity licence or responsible declaration from the town hall, whichever structure you choose.
• Staff: both autónomos and SLs can hire, but you must register as an employer with Social Security first.

So which should you choose?

As a rule of thumb, autónomo suits people starting small, testing an idea, or with modest profits. An SL becomes more attractive as profits grow, when there is real business risk, when there are several partners, or when you want to reinvest profits in the business. The point where an SL starts to pay off depends on your profit, your region and how much you take out each year, which is why we run the numbers for your specific case in the free consultation.