If you set up a Sociedad Limitada (SL) or Sociedad Anónima (SA) in Spain and become its administrador, you have signed up for liability that does not stop at the company’s share capital. Spanish corporate law layers four distinct liability regimes on directors — civil, tax, social-security and criminal — and several of them reach your personal assets without warning. For foreign founders running a Spanish entity from abroad, the trap is thinking the SL gives the same separation as a UK Ltd or US LLC. It does not. This is the 2025 working guide we run through with every new SL director.
The four liability layers
Spanish director liability is governed primarily by the Ley de Sociedades de Capital (LSC), with overlapping rules in the Ley General Tributaria (LGT), the Ley General de la Seguridad Social (LGSS), and Article 31 bis of the Código Penal (corporate criminal liability since the 2010 reform). The four layers are independent — a director can be cleared on one and still liable under another for the same set of facts.
| Layer | Source | Personal exposure | Trigger |
|---|---|---|---|
| Civil liability for damages | LSC arts. 236–241 | Joint and several with co-directors | Breach of duty causing damage |
| Liability for company debts | LSC art. 367 | All post-trigger debts | Failure to dissolve/file insolvency on a “cause of dissolution” |
| Tax liability | LGT art. 43.1 | Outstanding corporate tax | Negligence or wilful default in tax compliance |
| Social Security liability | LGSS art. 18.3 | Unpaid worker contributions | Same as above, contributions side |
| Criminal liability | CP arts. 31, 31 bis | Personal fines + prison | Specified corporate offences |
Civil liability for damages — the duty of care
LSC art. 225–227 imposes a duty of “an orderly businessperson and loyal representative” on every director. Breach causing damage to the company, shareholders or third parties triggers personal liability under arts. 236–241. The action can be brought by the company itself (after a shareholder vote), by a minority of 5%+ shareholders, or by individual creditors who suffered direct damage.
In practice the action most foreign founders meet is the acción individual by a creditor whose invoice went unpaid because directors mismanaged. Damages cover the unrecoverable amount plus costs.
The dissolution trap — LSC art. 367
This is the rule that catches foreign founders most often. When a Spanish company hits a cause of dissolution (the most common is net equity below half of share capital — patrimonio neto < ½ capital social), directors have two months to either:
- Convene a shareholder meeting to resolve the situation (capital increase, formal dissolution, or concurso de acreedores if insolvent), or
- File for insolvency themselves if the company is insolvent.
Miss the two-month window and directors become jointly and severally liable for every company debt incurred from that moment on. Not pre-existing debts — new debts. So if your SL kept ordering supplies for six months while underwater, every one of those invoices can be claimed personally from the directors.
The losses-below-half-capital test is simple to monitor: pull the balance sheet quarterly, compare net equity to share capital. If equity drops below half, the clock starts. Most accounting firms in Spain will flag this automatically — but they don’t always communicate it as urgently as they should.
Personal tax liability — Article 43 LGT
Article 43.1 LGT makes directors subsidiarily liable for the company’s outstanding tax debts in two situations:
- 43.1.a — directors of a company that has committed a tax infringement, when they did not act diligently to prevent it.
- 43.1.b — directors of a company that has ceased operations, for tax debts existing at the time of cessation that have not been paid.
“Subsidiary” sounds soft but isn’t — the AEAT (tax authority) only needs to fail to collect from the company before turning to directors. In practice, the AEAT issues a derivación de responsabilidad notice naming the directors personally. You then have one month to appeal or pay.
The amounts add up fast. A typical SL with three years of late VAT and corporate tax filings can build €40,000–€100,000 in director-level exposure before anyone notices.
Social Security joint liability
LGSS art. 18.3 mirrors the tax rule for unpaid worker Social Security contributions. The TGSS (Social Security treasury) can pursue directors personally for any contributions left unpaid when the company ceases or becomes insolvent. The mechanics are identical: notice, one-month appeal window, then enforcement against personal assets.
For founder-directors who employ themselves, this includes their own unpaid autónomo societario contributions. We see this constantly in companies that paused operations during 2023–2024 cash crunches and never formally closed.
Criminal liability — Art. 31 bis CP
Since the 2010 reform of the Spanish Penal Code, legal persons can be criminally liable for a closed list of offences (tax fraud, money laundering, bribery, environmental, data protection, market abuse, fraud against creditors, etc.). Director liability is parallel — they can be charged personally as authors or co-authors when the corporate offence happened on their watch.
The defence Spanish criminal law gives companies (and indirectly their directors) is a modelo de prevención de delitos — a documented compliance programme with risk mapping, controls, training, monitoring, and an internal channel. A working compliance model can either eliminate corporate criminal liability or substantially mitigate it. Foreign-owned SLs almost never have one out of the box; setting one up is a 2–3 month project for a working SL.
Practical mitigations
- Quarterly equity check. Net equity vs share capital, every quarter, in writing. The two-month dissolution clock can’t run if you act before the trigger.
- Tax filings on time, every time. The single highest-impact mitigation. Late filings + cessation = personal liability. Use a Spanish gestoría with monthly delivery, not annual catch-up.
- D&O insurance. Director & Officer policies are written by Hiscox, Chubb, AIG and others in the Spanish market. Annual premium typically €1,500–€4,000 for an SL with €500k–€2m revenue. Covers civil liability, defence costs, and (with extension) tax inspection costs.
- Documented decision-making. Proper minutes (actas del consejo), signed, dated, kept in the company minute-book. The single biggest evidence problem in liability disputes is “we discussed it but there are no minutes.”
- Compliance model. For companies handling money, data, or third-party assets — the modelo de prevención shifts the criminal-liability defence in your favour.
- Resignation done properly. Resigning as director takes notarial deed + Mercantile Registry filing. A verbal resignation does nothing — you are still liable. Until your resignation is registered, you remain on record.
Special considerations for foreign directors
Three issues compound for non-resident directors of Spanish companies:
- Service of process across borders. AEAT and TGSS notices are served at the company’s registered address. If you’re not in Spain and the office isn’t actively monitored, you can miss the one-month appeal window before you even know the notice exists. Solution: appoint a Spanish-resident representante fiscal or have your gestoría flag every official notice the same day.
- Currency and asset reach. A derivación de responsabilidad against a non-resident director can be enforced via EU-wide tax-cooperation directives (mutual assistance in recovery) and via national enforcement in the UK, US and other treaty partners. Foreign assets are not safe havens.
- Beckham Law interaction. Foreign executives on the Beckham Law regime who are also SL directors face the same liability — the regime affects how income is taxed, not director duties.
If you are setting up an SL, joining one as director, or worried about exposure on a company you already run, book a free consultation. The 30 minutes typically pays for itself in caught-early issues — most director liability cases we see could have been prevented if someone had spotted the cause-of-dissolution trigger or the late-filing pattern six months earlier.
