In September 2014, the Spanish government adopted a law to support entrepreneurs; fifteen months later, it is considering adopting seven new measures that will simplify the administrative steps for granting this golden visa or residential permit in Spain.
One of the most important novelties introduced by the reform of the Law on Income Tax in Spain concerns the VAT taxation of a company’s partners engaged in professional activity.
The new fiscal reform in Spain, which will gradually be implemented in 2015 and 2016, will benefit rents bellow 50.000€ and individuals with family responsibilities. Severance pay shall be taxed, the exclusion of the dividends is abolished and the deductible quality of pension plans is reduced.
In its judgment on 3 September 2014, the European Court of Justice (ECJ) declared that Spain had infringed Community law by permitting differences in its tax treatment of the inheritance and gift tax between residents and non-residents in Spain and requires the return of wrongfully collected revenue.
The new fiscal measures that benefit small sized entreprises or SMEs in Spain reduce the Corporate tax to as low as 20,25%.
The Preliminary Law on Fiscal Reform in Spain is creating a much more effective business competition aimed at both self-employed workers and businesses. The Reform proposes changes to tax on companies (TC), tax on the income of individuals (TII), tax agency, and VAT regarding e-commerce.
The fiscal reform in Spain implies a lowering of tax withholdings for self-employed people whose annual income is lower than 12.000 €. Self-employed workers can benefit from these measures beginning on the 1st of July 2014.
The cuts to tax benefits planned in the draft of the Spanish fiscal reform will affect property acquired before the 31st of December 1994, experts thus expecting a rise in sales.
The new tax reform in Spain lowers the income tax by about 12.5% and provides a deduction for taxpayers with large families, elderly family members, or disabled dependents. This means that these taxpayers will be able to deduct about 1,200 Euros per year, an amount which, depending on the case, may increase.
Regarding International taxation and customs control in Spain, certain concepts have been highlighted such as the abusive use of internal and international regulations, the control actions, the transfer prices as well as other control measures.
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