Tax Conditions

Corporate Tax

Corporate tax applies to entities that are resident in Spain for tax purposes.
In general, tax base is calculated according to the profits or losses indicated in the financial statements, ± certain non-accounting adjustments provided for in the Corporate Tax Law.
The corporate tax rate in Spain has decreased in the last few years. For tax periods starting from January 2008 onwards, the tax rate is 30%. Lower tax rates apply in certain cases, such as for SMEs.

Personal Income Tax

Personal income tax applies to individuals who are tax residents in Spain. Personal income taxpayers are taxed on their worldwide income.

Taxpayers are considered as resident in Spain if they spend more than 183 days in Spain during a calendar year, or if their main centre or base of their business or professional activities or their economic interests is in Spain.

The recent tax reform determines that the taxable income is made up of a general base and the "savings base":

The savings base consists of the positive balance resulting from income from movable capital, and the positive balance resulting from capital gains/losses deriving from the transfer of assets. The savings base is taxed at a rate of 21%.

The general base consists of the balance resulting from adding together all other income (salary payments, income from business or professional activities, rental income, etc.), and/or the positive balance resulting from gains/losses not included in the savings base (e.g. prizes).

As regards tax rates, there is a general scale and a regional scale; the minimum combined rate for income up to €17,707.20 is 24.75% and the marginal combined rate for income from €53,407.20 is 52%.

Transfer and Stamp Duty

This tax is levied on a limited number of transactions, including:

TYPE OF OPERATION APPLICABLE RATE
Notarised Documents 1.5%
Real Estate Tranfers
10%
Property Transfers 8%

Value Added Tax (VAT)

The standard rate is 21% and applies to most supplies of goods and services. There is a reduced rate of 10% applicable to certain supplies of goods and services. There is also a "super-reduced rate" of 4% that applies, for instance, to essential food items, books, newspapers and magazines, or certain government subsidised housing.

Certain transactions are exempt from VAT (for example, financial and insurance transactions, medical services or educational services).