The Community of Madrid has approved a new financial aid program offering up to €150,000 to support small businesses and self-employed workers with business expansion projects. Priority will be given to enterprises located in municipalities with fewer than 20,000 inhabitants, aiming to boost entrepreneurship in rural and less populated areas and facilitate access to liquidity for growth initiatives.
Amount of Aid and Eligibility Criteria
Announced initially in June 2025, this funding initiative will be implemented through a regional government agreement and become available starting the second quarter of the current year. The aid will subsidize up to 50% of the investment required for business growth, with a maximum grant of €140,000.
An additional €10,000 may be granted if the business operates in one of the 142 municipalities with fewer than 20,000 residents.
To qualify, applicants must meet the following conditions:
- Have been in operation for at least three years;
- Employ a minimum of nine staff members.
Entrepreneurs will also be required to submit a strategic plan outlining their expansion goals, including staff increases, opening new establishments, or modernization efforts.
Objectives of the Financial Support
This measure aims to strengthen businesses during the critical consolidation phase by addressing common challenges such as:
- Limited access to financing for expansion or digital transformation;
- Difficulties in recruiting and retaining specialized personnel;
- The need to adapt business models to evolving market conditions.
Tax Benefits in the Community of Madrid
The Community of Madrid is known for its business-friendly tax environment, characterized by the absence of regional taxes and a range of fiscal incentives.
Key tax advantages include:
- A planned reduction of 0.5 percentage points in the regional portion of personal income tax (IRPF) starting in 2026;
- A 20% deduction on the same tax for individuals relocating their tax residence to Madrid after living outside the region for at least five years.