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Restaurant Management Glossary

Glossary of Legal and Tax Terms for Restaurants in Spain

The 19 legal and tax terms for restaurants in Spain: licenses, HACCP, hospitality VAT, collective agreement, LLC vs self-employed and more.

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Legal, Tax & Regulatory — restaurant management glossary ChefBusiness
Glossary

19 terms on legal, tax & regulatory

Operating legally is not an option: it is the foundation on which any sustainable gastronomic business is built. These concepts cover licenses, taxation, labor regulations and food safety.

11 High priority
8 Complementary
19 Block total
Key concepts

The terms you must master

Activity License

Municipal authorization to operate the business. Verifies compliance with urban planning, health and safety regulations for the premises.

licencia actividad restaurante madrid

Health License

Authorization from the health authority. Confirms the establishment meets hygiene standards for food handling.

licencia sanitaria hostelería

Terrace License

Municipal permit to install tables on public roads. Temporary in nature, renewable annually, with specific hours and dimensions regulations.

licencia terraza restaurante ayuntamiento

Music License

Authorization to play music on the premises. Requires payment of royalties to SGAE and/or corresponding collecting societies.

licencia música restaurante sgae

HACCP

Preventive food safety system mandatory in the EU. Implementation is a requirement for the health license.

appcc hostelería plan obligatorio

Food Handler Certification

Mandatory training for anyone working with food. Certification is required for hiring.

carnet manipulación alimentos restaurante

Hospitality VAT

Food and table service at 10%. Alcoholic beverages at 21%. Separate tax bases mandatory in invoicing.

iva hostelería tipos restaurante

Limited Liability Company (LLC)

Most common legal structure in hospitality. Limits liability to contributed capital and offers tax advantages above certain revenue levels.

sl para abrir restaurante ventajas

Self-Employed

Self-employment regime. Option for small businesses with a single owner. Variable contributions based on income since 2023.

autónomo restaurante cuota seguridad social

Allergen Regulations

European regulation requiring information on the 14 mandatory declaration allergens in each dish served.

normativa alérgenos restaurante ue

Time Tracking

Legal obligation to record each employee's working hours. Fines starting at 626€ per employee without records.

control horario empleados hostelería
Legal, Tax & Regulatory — professional restaurant management

Every concept on this list is a lever for improvement in your restaurant. Mastering them is the difference between managing with criteria or improvising.

Chef John Guerrero · ChefBusiness

All terms

Complete glossary of legal, tax & regulatory

M

Public Liability Insurance

Policy covering third-party damages (food poisoning, accidents). Not legally mandatory but essential in practice.

M

IAE

Business Activities Tax. Businesses with turnover under 1M€ are exempt, but registration in the corresponding category is mandatory.

M

Direct Assessment

Tax regime where you pay tax on actual profit (revenue minus deductible expenses). The most common for restaurants with revenue.

M

Simplified Regime

Tax regime based on modules, not actual profit. Limited to small businesses with specific requirements.

C

NDA

Non-disclosure agreement. Used in business transfers, due diligence and supplier agreements to protect sensitive information.

M

Intellectual Property Brand

Legal protection of the restaurant name, logo and identifying elements. Registration with OEPM for national protection.

M

Trademark Registration

Process of registering the brand with the Spanish Patent and Trademark Office. Protection for 10 years, renewable.

M

Termination of Employment

End of employment relationship: dismissal, resignation, end of temporary contract. Each type has its own compensation and deadlines according to the collective agreement.

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Complete glossary

Other glossary blocks

Finance and Profitability → Opening & Pre-Operations → Operations & Kitchen → Staff and Human Resources → Marketing, Sales and Customer → Business Model and Strategy → Menu and Product Engineering → Technology and Digitalization → Sustainability and Trends → Space, Design and Physical Experience → Diagnosis, Audit and Methodology → Investment, F&B and International Expansion → Types of Food Service Concept →

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FAQ

FAQ: legal, tax & regulatory

LLC or self-employed: which is better for my restaurant?
If you earn more than 40,000-50,000€/year or have employees, the LLC is usually more advantageous financially and limits your personal liability. If you are a very small business without employees, self-employment is simpler but you assume unlimited liability with your personal assets.
How long does it take to obtain an activity license in Madrid?
With a responsible declaration (the most common method), you can open in 24-48 hours if all documentation is correct. The subsequent municipal inspection can take 1-6 months. If there are deficiencies, you are given a deadline to correct them.
Is time tracking mandatory for all employees?
Yes, since 2019. Mandatory for all workers regardless of contract type. Records must be kept for 4 years. Fines for non-compliance range from 626€ to 6,250€ per employee.

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