TAXES IN SPAIN. THE CORPORATE TAX
The companies established in Spain are taxed for the profits obtained with the Corporate Tax (“Impuesto sobre sociedades”), as in most of the countries, but with some differences. These are some of the main points to know about this tax in Spain:
General tax rate of 25%.
In some cases this tax rate can be reduced to 15% in the first two years of activity. This can be not applicable if the same shareholders have the similar companies in other countries.
Some deductions for R&D are deductible in the Corporate Tax (the % of deduction can go from 27 to 42%).
With some conditions, the dividends received by Spanish companies are tax exempt.
There is a special regimen for SMEs in Spain. Although the tax rate is the same (25%), these companies can apply for accelerated depreciation and other advantages.
The companies have to prepare three instalment payments (“pagos fraccionados”) along the year on the account of the final payment.
In case the company has paid a tax similar to Corporate Tax in other countries (withholding tax on royalties, interests, dividends), this tax can be deducted partially or totally in the Spanish Corporate Tax, according to the Spanish law and the Agreement to avoid double taxation between Spain and the country where the income was obtained.
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