Corporate tax
Tax rate for resident companies |
Company tax rate is at 35%. A reduced rate of 30% is applied for companies whose turnover does not exceed 6 million EUR, on the first 90,152 euros bracket . There is no minimum flat-rate taxation.
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Taxe rate on long-term capital gains |
Capital gains are taxed in Spain at the rate of 35%.
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System governing groups of companies and dividends paid by subsidiaries to their parent companies |
Dividends paid by a company resident to another company resident are liable to withholding tax at the rate of 25%. Generally, a tax credit of 50% is granted to any company resident receiving dividends.
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Tax rate on branches |
Branches are subjected to the corporate tax as all the other companies.
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Income tax
Fiscal year |
The fiscal year begins on January 1-st and ends on December 31 of the same year.
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Income tax rate |
Income tax is governed by the law 14/1996 establishing a division of competence between the State and the autonomous provinces. The global progressive tax rate ranges from 18% to 48%. 2004 Personal taxation in Spain is the following:
| Taxable income (in Euros) | Applicable rate | | 0 - 4000 | 18% | | 4000 - 13.800 | 24% | | 13.800 - 25.800 | 28% | | 25.800 - 45.000 | 37,2% | | > 45.000 | 45% |
There is also a wealth tax which rate is at most 2,5%.
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VAT rates
Standard rates |
The common rate is 16%.
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Reduced rates |
Reduced rates of 7% on food; water supplies; renovation & repair to private homes; hairdressing public transport; 4% on basic foodstuffs books, newspapers, pharmaceuticals and rental of certain houses.
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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.
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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.
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Last modified in
January 2003
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