Payroll for Remote Employees in Spain

When we speak about working in a team in the 21st century, we need to address working remotely collaborating with others via digital means. Because this is what we do even right now. And this happens very often within the work environment as well. In this article, we will talk about accounting, legal obligations, payroll for remote employees and managing remote teams in Spain.

Teams nowadays can be situated in different parts of the world and they need to synchronize their activities in order to accomplish a given goal. And an employer should pay remote employees properly in a timely manner. Location of individual members is less of a problem nowadays. However, there is some specific etiquette when it comes to collaborating as part of a team and meeting digitally.

Payroll remote employees Spain

Taxes and Legal Obligations in Spain

In order to comply with tax and legal obligations in Spain, the law establishes that you need to appoint a tax representative to be appointed in Spain, whenever there is a non-resident entity trading in Spain. This figure is subcontracted to a private individual who acts on behalf of non-resident entities and private entrepreneurs trading in Spain.

For a non-resident company, it is required whenever you incorporate a new entity in Spain either constitute a foreign subsidiary or a Spanish branch. Or you are going to hire a new employee before the Spanish Social Security Agency for signing any private and public commercial contracts.

For clients and suppliers, it’s required for representing the company before Spanish Tax Authorities or any other third-party entities like CNMV, Bank of Spain, Notary or some forms.

For a private entrepreneur, it is required when: for instance, a filing tax returns on their behalf before Spanish tax authorities and managing their daily tax issues and communications before Spanish Tax authorities. The complete process lasts between 4 and 6 weeks when the legal Power of Attorney (POA) is ready for registration and filing before third-party institutions such as Spanish Tax Authorities or any other party.

The legal Power of Attorney which is something prepared by Swapp Agency will be notarized and duly translated into Spanish by a sworn translation.

According to the current Spanish normative, which is compulsory to gain with a tax representative in Spain, failure to have (in a place) will result in a sanction to be imposed between 2.000€ and 6.000€ that will be imposed from Tax Authorities. It is mandatory to have a tax representative appointed in Spain for all those non-resident entities who trading in Spain through ability number in Spain or a Spanish branch, regardless of the country where they come from.

Swapp Agency offer a turnkey service to all non-resident companies from the beginning of their presents in Spain, advising on the best HR and payroll to softly land in Spain.

Payroll remote employees Spain

Managing Remote Teams in Spain

So, how do we make our team one that delivers consistently and how do we make our team one that trusts the members of that team even if they don’t meet on a regular basis.

Today we have a lot of solutions that we can adopt in order to make our digital team a high performer in any sort of given task that has been allocated.

The first thing to do is to really take time to become personal with people rather than quickly jumping into the formal communication or the formal problem or agenda of the day.

It is perfectly acceptable as a matter of fact advisable to take the first 10 minutes of a meeting to ask people about how they are and then to allocate enough time for them to share how they are feeling and how they’re facing their tasks. Are there any difficulties related to work or related to their families?

Just give your employees the opportunity to talk about themselves. This would make people keener on communicating and sharing their opinions and perspectives later on as well.

Another important element to consider is recording. You need to make sure that everything that is mentioned and agreed upon is actually recorded or documented in some sort of way. Nevertheless, if you record your video communication, this may make some people more hesitant to share their ideas.

So, even if you are recording, make sure you have a brief session before the recording. Make sure you have up to 10 minutes to let people throw their ideas at you. And you can just put down on a piece of paper even who suggested what idea. And later on, as you start recording the session, you can then go back to these people who have suggested this idea.

Make sure that there is a specifically chosen number of platforms or channels that are approved for communication. Because you don’t want to be in a situation in which different members of the team are trying to share files via different channels.

Payroll remote employees Spain

Accounting out of Spain

If you are going to have a Spanish entity registered in this warm country and you want to keep your legal accounting and taxes compliant out of the Spanish territory, the following could be of your interest. Any company registered in Spain can manage and maintain its accounting out of Spain. It must be adapted to the local requirements established by the Spanish normative.

Accounting must be under Spanish GAAP, in Euros and in the Spanish language. Although accounting books can be maintained in a different language, for the preparation of the Statutory account, the Spanish language is required.

There also are compulsory books like journal books, official books and statutory accounts that must be maintained with paper support or electronically and be kept for 6 years.

Non-compulsory books, like general ledger, VAT books and other supporting documentation, can be maintained electronically.

Spanish Inland Revenue, including tax documentation and accounting documentation, must be kept for 4 years.

What Work Can Be Done Outside of Spain?

With Employer of Record, foreign companies can easily operate in Spain. Swapp Agency will assist you with the following services: accounting, tax compliance, HR, payroll and many others.


Any Spanish company can manage and maintain accounting, tax compliance and administration out of Spain if needed. Provided that they adapt to Spanish requirements.

If you are going to register a company in Spain and you want to manage and keep all the accounting administration and Tax compliance in Spain, you can do it with Swapp Agency.

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