Director of a Spanish SL while living in Italy: what it involves

You can be a director of a Spanish sociedad limitada (SL, a private limited company) without living in Spain and without owning a single share. The Ley de Sociedades de Capital does not require directors to be shareholders unless the articles say otherwise (article 212). It happens often: an Italian company opens a Spanish subsidiary, or a family with a business in both countries splits the roles. Accepting the appointment brings a formality to complete in Spain, a set way to be paid and to report it, and a personal liability that stays the same whether you live in Milan or in Rome.

Without an NIE, the appointment never reaches the Registry

The shareholders' meeting makes the appointment, and it takes effect when the director accepts it (article 214.3). From acceptance, the company has ten days to file it with the Registro Mercantil, the Spanish companies register (article 215).

To register it, the Registry has to record the director's identity. Article 38 of the Reglamento del Registro Mercantil asks, for foreign nationals, for the número de identificación de extranjero and the Spanish tax number where there is one. In practice, notaries and registrars insist on the director's NIE. Without it, registration is suspended and the appointment cannot be relied on against third parties: to banks, clients and suppliers, you are not yet the director.

You can apply for an NIE from Italy at a Spanish consulate. The acceptance can also be signed in Italy, before an Italian notary and with a Hague apostille, without travelling to Spain.

The role is unpaid unless the articles say otherwise

That is the rule in article 217: el cargo de administrador es gratuito, unless the articles set up a remuneration system. The system has to name its components: a fixed fee, attendance allowances, a share of profits, variable pay, among others. Each year, the shareholders' meeting approves the maximum amount for all directors together.

If your SL's articles say nothing about pay and the company plans to pay you for the role, the articles need amending first. A payment with no basis in the articles has no legal footing, with the shareholders or with the tax authority.

How your fee is taxed: first in Spain

For the Spanish tax authority, a fee paid by a Spanish-resident company to its director is income earned in Spain, wherever the director lives (article 13.1.e of the non-residents' income tax law, the IRNR). The Italy-Spain double tax treaty confirms it in article 16: fees received as a board member of a company resident in one state may be taxed in that state.

The rate is 19% for residents of the European Union, Iceland, Norway and Liechtenstein, and 24% for everyone else. It applies to the gross amount, with no deductible expenses.

The company withholds the tax and pays it with modelo 216, in the first twenty days of April, July, October and January. In January it also files modelo 296, the annual summary of withholdings on non-residents. On your side, keep the withholding certificate: you will need it in Italy.

Then in Italy

If you are resident in Italy, Italy taxes your worldwide income, including what comes from the Spanish SL. The Italian income tax code (TUIR) treats director fees as redditi assimilati a quelli di lavoro dipendente, income treated like employment income (article 50, paragraph 1, letter c-bis), unless the role is part of your professional practice, as with a commercialista (chartered accountant). In that case it is self-employment income.

Double taxation is removed through the foreign tax credit in article 165 of the TUIR, claimed in section CE of the Redditi return. The treaty provides for it too (article 22): Italy deducts the tax paid in Spain, capped at the share of Italian tax that relates to that income. So the 19% withheld in Spain comes off the Italian IRPEF due on the fee, up to that cap.

Social security is a separate question

Within the European Union, Regulation (EC) 883/2004 means a person pays contributions in one country at a time. If you live in Spain and control and run the company, the usual result is registration in the RETA, the Spanish self-employed scheme. If you live and work in Italy, the answer depends on where you actually carry out the work, and the document that proves it is the A1 certificate. It pays to settle this before the first fee arrives.

Liability does not stay in Spain

A director is liable to the company, its shareholders and its creditors for damage caused by acts or omissions contrary to the law, the articles or the duties of the role, where there is intent or fault (article 236). When the act breaks the law, fault is presumed. The claim becomes time-barred after four years (article 241 bis).

One rule hits hardest anyone joining a company that is already in trouble. If the SL has a legal ground for dissolution, for example because losses have taken net equity below half the share capital (article 363), the director has two months to call a shareholders' meeting. For a director appointed later, those two months run from acceptance of the role (article 367). Miss them and you become jointly liable, with your own assets, for the company debts that arise afterwards. We cover this in more detail in our article on closing a company in Spain.

Living in Italy shields you from none of this. A Spanish judgment against you is recognised and enforced in Italy under Regulation (EU) 1215/2012, with no special procedure.

What is usually checked before signing

Before accepting, an incoming director usually asks for the latest approved and filed annual accounts, to compare net equity with share capital. They also check what the articles say about pay, whether the company owes money to the Spanish tax authority or to Social Security, and who in Spain will handle the day-to-day obligations: bookkeeping, tax returns, filing the accounts. Four documents and one conversation, and they head off surprises that would otherwise be paid out of personal assets.

If you have any doubts, Riondato & Partners is here to help

With over 45 years of experience between Italy and Spain, Riondato & Partners works with people who run a Spanish company from Italy: the appointment, the pay, the tax in both countries and the duties that come with the role. If you have been asked to become a director of a Spanish SL, get in touch with us.

Sources

• Ley de Sociedades de Capital, consolidated text (BOE)
• Reglamento del Registro Mercantil, article 38 (BOE)
• Spanish Tax Agency: directors' remuneration for non-residents
• Spanish non-residents' income tax law (BOE)
• Italy-Spain double tax treaty (BOE)
• Fiscomania: director fees from a foreign source (Italian)