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Tax Law & Golden Visa

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Questions about corporate taxes in Spain

These Corporation Tax FAQs are meant as a general guidance for taxpayers and do not take into account the taxpayer’s situation or objectives. These FAQs do not intend to replace the law or change its meaning. Contact Golden Mile Law Firm for further advice.

It is the tax you pay for doing business as a corporation and other corporation schemes in the Spanish territory or Spanish branches. This tax is known as Impuesto sobre sociedades (IS, in Spanish).

This depends on the company, its type, size, and legal and tax obligations. Some of the taxes are the corporation tax (IS), tax for small medium-sized enterprises, tax for insurance joint ventures, tax for startups, tax for NGOs, tax for securities investments, among others.

The Corporation Tax (IS, in Spanish) taxes corporations with commercial operations, associations and foundations. The Income Tax from Individuals (IRFP, in Spanish) taxes the revenues obtained by individuals. The IS depends on the corporation’s profits; this includes limited liability companies and other corporation schemes.

Talk to your tax advisor. This tax may depend on your annual revenues, so ask your tax advisor on which is the best company type for you based on your income. In general terms, this tax is 25% of your annual revenues, but this depends on the company type. For example, NGOs will pay between 15% o 30%. 

Paying this tax is complex. As a general step, you should apply the IS percentage of your company type to the difference between the revenues and the expenses. And then, apply any adjustment.

Annually. It should be paid between 1 to 25 July each year. It is mandatory regardless of whether you obtained income or not. 

This tax can also be paid in three installments in April, October and December.

Corporate law refers to the laws, rules and regulations related to corporations, including corporation’s formation, ownership and management. It involves advising on buying decisions, mergers and acquisitions, shareholder’s rights, shareholders agreements and BoA meetings. The legal advice depends on the corporation type (for example, limited liability, public or private 5. companies).

Corporate law is also known as business law, enterprise law or company law. They all refer to the law related to corporations and their incorporation, governance and dissolution.

This legal are comprises all forms of business transactions including trade, buy-sale operations, transportation and contracts.

Due diligence in real estate provides an accurate analysis of the property before making a transaction. This analysis allows a comprehensive study from a legal, technical, commercial and environmental perspective, helps to speed up the negotiation period and makes the process more transparent, useful in case of future audits. 

Since due diligence changes depending on the state, interested parties should ask their attorneys or real estate agents about any term they are unsure of.

It is a tax that must be borne by legal persons (commercial companies, foundations, associations, investment or pension funds, participation accounts, etc.).

The general rule is that this tax is calculated from the accounting result (income obtained from economic activity once the expense generated by it has been deducted). The tax rate of the tax is applied to this amount, what will give us as a result the quota. From there, it will correspond to apply the relevant deductions and bonuses.

The amount depends on the type of company. The general tax rate is 25%, although there are higher rates such as 30% (for financial entities or hydrocarbon companies) and lower rates (such as 15% for newly created entities).

The fiscal year cannot exceed 12 months and usually coincides with the natural year. In the event that you wish to alter this rule, it must be clearly specified in your company constitution statutes.

Within the semester following the closing of the fiscal year, the shareholders must meet to approve or reject the corporate accounts. The annual accounts must faithfully reflect the financial situation of the company, and will be deposited in the corresponding Commercial Registry.

Once 6 months have elapsed since the company’s fiscal year closed, you will have 25 calendar days to file the return and pay the resulting tax. Thus, if the fiscal year was from January 1 to December 31, 2019, the date to carry out this procedure will include the first 25 days of July 2020.

Yes, they are held in April, October and December. Its amount will be, as a general rule, 18% of the tax quota obtained in the previous financial year, with the company being able to opt for other different calculation systems according to the law.

Certain operations entail, for Spanish law, the inclusion of the company in the special regime. Examples of this are business groups that carry out tax consolidation, corporate transformations (such as mergers and splits), companies that have as their object the rental of homes or those of small size.

More information about Tax law

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