| Tax conditions |
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 Corporate Income TaxCorporate income tax applies to entities that are tax resident in Spain.
In general: Tax base = income/loss per books ± certain non accounting adjustments provided for in the Corporate Income Tax Law.
The corporate income tax rate in Spain has decreased in the last few years. Thus, for tax periods initiated as from January 2008, the applied tax rate is 30%. Lower tax rates apply in certain cases, such as small and medium size enterprises.
Personal Income TaxPersonal 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 18%.
The general base consists of the balance resulting from adding together all other income (salary income, 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 €17,360 is 24% and the marginal combined rate for income from €52,360 is 43%.
Transfer and Stamp TaxThis tax is levied on a limited number of transactions, including:
Value Added TaxThe standard rate is 18% and applies to most supplies of goods and services. There is a reduced rate of 8% 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). |
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