Spain

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TAXES - ACCOUNTING

 

 

Corporate tax

Tax rate for resident companies

The corporate tax rate is 35%.
A reduced rate of 30% is applied for companies whose turnover does not exceed 8 millions EUR, on the first 120,2002.41 euros bracket. There is no minimum flat-rate taxation.
Under the proposed tax reform, the general corporate tax rate would be gradually reduced to 25% for companies with a turnover under 8 millions EUR, and 30% for other companies.

   
Tax rate on long-term capital gains Capital gains tax rate is 35%.
A 15% reduced tax rate is applicable to long-term capital gains.
   
System governing groups of companies and dividends paid by subsidiaries to their parent companies Dividends paid by a resident companies to others resident companies are liable to a 15% withholding tax.
   
Tax rate on branches Branches are subjected to the corporate tax as well as all other companies.




Income tax

Fiscal year The fiscal year begins on January 1st and ends on December 31st of the same year.
   
Income tax rate Income tax is governed by the law 14/1996 establishing a division of competence between the State and the autonomous provinces. State tax and regional tax coexist. The global progressive tax rate ranges from 15% to 45%:

Taxable income (in EUR)
Applicable rate
0 - 4000 15%
4000 - 9.800 24%
13.800 - 12.000 28%
25.800 - 19.200 37%
> 45.000 45%

There is also a 2,5% wealth tax.
   



VAT rates

Standard rates 16%
   
Reduced rates The reduced rates are 4 and 7%. The 4% rate applies to basic necessities. The 7% rate applies to food, dwellings, certain transport services and tourism.
Exports and export-related services are zero-rated, as well as financial operations and insurances, healt cares and education services.



Other important taxes


Name of tax
Rate
Tax on construction and installation projects  
0 to 4%  


 

Accounting

Introduction
Since 1996, all the formalities of deposit of the annual accounts of Limited and Private companies have been governed by the trade register regulation.


Obligations and publications
Companies must hold a inventory book and annual accounts..
Annual accounts must contain the balance sheet, the loss and profit account and the annexes.

Certification and auditing
Annual accounts must be dated and signed by the manager, the associates or by all the administrators according to the size of the company.

Professionals and representative organizations
The accounts and audit department (Instituto de Contabilidad y Auditoria de cuentas, ICAC) is the accounting body of normalization.



Useful links
The Agencia Tributaria
Ministerio de Hacienda y de Economica

Last modified in January 2007
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