Introduction
Thinking of starting or expanding your business in Europe but unsure whether Spain or France is the better choice? While both countries offer access to the European market, Spain stands out as the more business-friendly destination for entrepreneurs.
With seamless connectivity to Latin America, North Africa, and the Middle East, a lower-cost business environment, and simpler immigration pathways for foreign entrepreneurs, Spain is emerging as a preferred choice for startups and international businesses. France, on the other hand, comes with stricter banking regulations, a higher cost of living, and more complex residency processes.
So, how do Spain and France compare in terms of business setup, taxation, immigration, banking, and operational costs? Let’s take a closer look at why Spain is the smarter choice for entrepreneurs in 2025.
Spain vs France: Key Comparisons
Here are the key differences between Spain and France:
1. Connectivity & Market Access
One of the biggest advantages of doing business in Spain is its geographic location and advanced port infrastructure. Spain serves as a gateway to Latin America, North Africa, and the Middle East, making it an ideal hub for businesses looking to expand beyond Europe.
France, while offering excellent access to the EU market, does not provide the same strategic international connectivity as Spain. For entrepreneurs looking to operate globally, Spain’s logistical advantages and trade routes are a game-changer.
2. Corporate Tax Rates Comparison
Both Spain and France have a corporate tax rate of 25%, making them equally competitive in standard taxation. However, Spain offers a special incentive for new businesses:
- Startups and newly registered companies in Spain benefit from a reduced corporate tax rate of 15% for the first four years.
- France does not provide such tax relief for new companies, making Spain a more attractive option for startups.
3. Easier Relocation & Residency for Entrepreneurs
For foreign entrepreneurs looking to relocate and establish a business, Spain offers a faster and more efficient process compared to France.
- Spain provides a 5-year residency permit, allowing business owners, directors, and employees to relocate within 25 days of receiving the European residence permit.
- France’s residency permit process is more bureaucratic and takes longer.
- Spain’s Intra-Corporate Transfer Visa is renewable indefinitely, while France’s ICT secondment visa is limited to just 3 years and cannot be renewed.
- For entrepreneurs who want long-term business stability and easy relocation, Spain’s streamlined immigration policies are a major advantage.
4. Business Banking in Spain vs France
Entrepreneurs looking to open a corporate bank account will find Spain far more accommodating than France.
- Foreign business owners can open a corporate bank account in Spain remotely, without needing a local resident director.
- In France, most banks require at least one company director to be a resident, creating additional obstacles for foreign entrepreneurs.
- This makes Spain the better option for international business owners who need a hassle-free banking setup.
5. Operational Costs
When it comes to cost-effective business operations, Spain is far more affordable than France.
- France’s average labour cost is approximately €16.39 per hour.
- Spain’s labour cost is €9.26 per hour, making it 43% cheaper than in France.
Lower labour costs significantly reduce business expenses, making Spain an attractive destination for startups, tech companies, and labour-intensive industries.
6. Cost of Living for Entrepreneurs
Entrepreneurs relocating to Spain will find it 26% more affordable than France, making it easier to maintain a high quality of life while keeping business expenses low.
- Housing, office rentals, and daily expenses are cheaper in Spain than in France.
- The cost savings allow startups to allocate more resources toward business growth rather than high living expenses.
Conclusion
When comparing Spain and France, Spain emerges as the better destination for entrepreneurs and foreign businesses. With superior market access, a startup-friendly tax system, simplified immigration pathways, easy banking, and lower business costs, Spain offers the ideal environment for startups and global enterprises.
If you’re looking to set up a business in Spain, OnDemand International can help you with company incorporation, compliance, tax registration, and residency permits.
Set up and expand your business in Spain today! Contact OnDemand International for expert guidance.
FAQ’s
Spain is better due to its lower startup taxes (15% for 4 years), easier immigration, lower labor costs, and seamless banking setup for foreign entrepreneurs.
Yes! Spain allows foreign entrepreneurs to open a corporate bank account remotely, without requiring a local resident director, unlike France.
Spain is much cheaper than France, with labor costs 43% lower and overall living expenses 26% cheaper.
Spain offers a 5-year residency permit with a fast-track process (relocation in 25 days). France’s process is slower and more bureaucratic.
