What is a Business Transfer and How Can It Benefit You as an Investor or Entrepreneur?
What is a Business Transfer and How Can It Benefit You as an Investor or Entrepreneur?
If you’re thinking about starting a business in Valencia—whether it’s a café, restaurant, shop, or hair salon—chances are you’ve heard of a “traspaso”.
This is a very common concept, especially in areas with high commercial activity, but it’s often not fully understood.
In this article, I’ll explain what a traspaso is, how it works, what its main advantages are, and what you should consider before making a decision.
What is a traspaso?
A traspaso is an agreement in which a tenant transfers the use of a commercial space—and the assets that make up the business—to a third party in exchange for financial compensation.
The new owner takes over a fully equipped and operational business, without having to start from scratch.
What is included in a business transfer?
The content may vary, but it usually includes:
- Furniture and equipment
- The activity licenze
- The regular clientele or “goodwill”
- The decoration, renovations, or improvements made
- The existing lease agreement (with the same conditions or renegotiated)
Example:
A person has a café in downtown Valencia, operating for 5 years, with a steady clientele. They decide to leave the business for personal reasons, but the premises are rented.
Instead of closing and returning the premises, they look for someone interested in continuing the business. They ask for €35,000 for the transfer, which includes the bar, tables, equipped kitchen, cash register system, and the valid business license. The new owner pays that amount and continues with the monthly rent to the property owner, under the existing conditions.
What benefit does it offer to the bayer
- Starting from day one: the premises are already set up and ready to operate.
- Lower initial investment: you don’t have to do renovations or buy everything from scratch.
- Proven location: the premises have already proven to be commercially viable.
- Fewer procedures: many licenses or permits can remain valid.
And folr the Seller?
- Recover part of the initial investment.
- Avoid penalty for breaking the lease contract-
- Close the business with a financial gain from one that the owner no longer wishes to manage.
Proposed visual scheme
[Propietario del local]
|
| (Contrato de alquiler)
v
[Inquilino actual]
|
| (Traspaso del negocio por X €)
v
[Nuevo empresario]Legend:
- The owner still renting the store, and usually with no change.
- The former tenant receives a payment for the tranfer
- The new entrepreneur continues the business under agreed condition
Legal and tax aspects to take into account
- The rental agreement must allow the transfer, or the landlord’s authorization must be obtained.
- The transfer must be documented in writing, with a detailed inventory and conditions.
- The amount received may be subject to taxation (personal income tax, VAT, etc.) depending on the case.
- It is advisable to seek the advice of a real estate professional and a lawyer to avoid problems.
Are you thinking of buying or transferring a business in Valencia?
A well-managed transfer can be a quick and profitable way to start a business or invest. But like everything in real estate and business, it’s key to get it right from the start.
I can help you with:
- Evaluate whether the transfer is fair and profitable
- Negotiate favorable conditions
- Check licenses and contracts
- Accompany you throughout the entire operation
Marcello Luigi Mauri