Entrepreneurs and professionals who carry out an activity in Spain are under the obligation to issue an Spanish invoice and a copy of the same for the delivery of goods and services carried out and to keep a copy of the invoice issued.  They also have the obligation to issue an invoice for any advance payments received with the exception of exempt Intra-Community deliveries of goods.

In all cases the Entrepreneurs and professionals are under the obligation to issue an Spanish invoice when they fall under the following cases:

• When the recipient of the invoices is an entrepreneur or professional and is purchasing the goods or services in the course of his/her business.
• When the recipient of the service or good demands it in order to fulfil any tax obligation.
• Export of goods exempt of IVA(except duty free shops).
• Intra-Community deliveries exempt of IVA.
• When the recipient is a Public Administration or Legal entity not acting as a entrepreneur or professional.
• Certain deliveries of goods which require installation or assembly before being handed over to the buyer, as long as this has taken place in the territory where the tax is in force.
• Remote Sale and delivery of goods subject to special tax, as long as its understood that the same take place in the territory where the tax is in force.

Exceptions to the Duty to Bill

There are certain exceptions to the obligation to issue an invoice in Spain; this can fall under the following transactions:

• The transactions exempt of Spanish VAT (as stated in the Law 37/1992 dated 28th of December, article 20), with the exception of the transactions related to the healthcare and hospitalization , delivery of real estate and the delivery of goods exempt because they have not been able to deduct the Spanish Vat input.
• The transactions done by the entrepreneur or professional in the development of its activity which is subject to the Compensation Charge special scheme.  Any way, an invoice should always be issued in all the cases where the delivery of real estate when the purchaser has waived the IVA exemption (article 154 – IVA Law)
• On the development of the activity for which they are registered in the simplified IVA Tax system unless due to the high volume of the activity the amount taxable will be charged depending on the income volume.   Nevertheless, they should always issue an invoice for the transfer of the tangible and intangible fixed assets as stated on (article 123.1-B)  nº 3 IVA Law 37/1992.
• Those that are authorised by the Tax Management Department of the Tax Agency in relation to business sectors or specific business in order to avoid disturbances to the development of the normal business activity.
• Those transactions done by entrepreneurs or professionals which are under the  special tax regime of agriculture, livestock, fishing without prejudice their duty to issue receipts (agricultural receipt) for flat rate compensation if they in turn have purchased the goods or services to entrepreneurs or professionals subject to the same tax regime.  In all cases, an invoice should always be issued for the deliveries of real estate stated on Article129.1, second paragraph fro the IVA Law 37/1992.
• Financial & Insurance operations, regardless the nature of the receiver of the service even if they are entrepreneurs or professional exercising their activity with the exception of the transactions subject but not exempt localised in the Territory of Application of the Tax or in another member State.

Additional information on this subject can be found at our micro web www.accountantsinspain.com

 Do not hesitate to contact the leading English speaking accountants at our firm Arcos & Lamers Asociados for any tax, legal, labour and accountancy advice.

Sara Duarte, Accountant in Marbella, tax consultant in Spain!.

Marbella, October 2013

The tax consultants of the Spanish law firm, Arcos & Lamers Asociados, wish to point out an important detail concerning the Income tax in Spain mentioned at the law 16/2012, of 27^th  December, establishing several measures aimed to consolidating public finances. This change does affect to the Spanish Income tax rules applicable to financial year 2013 that should be declared in 2014.

Elimination of the deduction for home investment.

With effect as from 1st January 2013, the deduction of investment in a Spanish home is eliminated at the Spanish Income Tax.

However, the above mentioned Spanish law has establishing a transitional period where the deduction at the Income tax in Spain is still in place for those tax resident individuals below mentioned. In general terms the deduction goes up to 15% of investment with a limit of Euros. 9.040. Kindly note that the terms and conditions of the mentioned deduction and / or abolishment will vary depending of the Spanish region where the tax paying is resident.

a) Taxpayers who acquired their residence (home) prior to 1^st January 2013.

b) Taxpayers who have paid for refurbishments at there homes prior to 1^st January 2013, provided that those works are completed before the 1^st January 2017.

For additional information please contact the tax advisers, registered accountants (economists) and tax lawyers of this leading law firm settled in Marbella, Arcos & Lamers Asociados, your tax specialist in Marbella, Málaga, Spain.

Maria Teresa Arcos, lawyer in Marbella.

Wim Lamers, economist in Marbella.

Marbella, September, 2013.

Tickets disappeared and have been replaced by “simplified invoices”.

This has taken place pursuant to the Royal Decree 1619/2012, of 30th November, approving the Regulations that govern the obligations to issue invoices.

The simplified invoice is a document that has replaced the usual tickets, with some changes included. The simplified invoices  have less information than usual invoices.

Who has the right to issue simplified invoices?

Pursuant to article 4 of aforesaid Royal Decree 1619/2012, the obligation to issue an invoice may be replaced, in some cases, by a ticket up to the year 2012 and by the new simplified invoice as from the year2013 inany of the following cases:

Any business manager:

a. when the sum of the invoice is less than 400 Euros, VAT included.

b. when a corrected invoices of a previous one must be issued.

Companies with the following specific activities:

In the case of transactions described below, when the sum of the invoice does not exceed 3000 Euro, VAT included:

a. Retail sales

b. Street selling or service rendering

c. Door-to-door selling or service rendering

d. Transport of persons and their luggage

e. Catering companies and restaurants: restaurants, bars, cafeterias, chocolate shops and similar

f. Services rendered by dance clubs and nightclubs.

g. Telephone services for use of telephone boxes, or by means or telephone cards not allowing any identification of the user

h. Hairdresser’s and services rendered by beauty salons.

i. Use of Sport Facilities

j. Developing of pictures and services rendered by photographic studios

k. Car parks and parking lots

l. video renting

m. Laundries and dry cleaner’s

n. Use of toll motorways

o. Other services authorized by the Inland Revenue

Contents of the simplified invoice

Pursuant to article 6 of aforesaid Royal Decree 1619/2012, at least the following information shall be obligatory when issuing a simplified invoice:

• Series number of the invoice
• Number of the invoice
• Date of the invoice
• Date of the sales or service rendering
• Description of the sales or service rendering
• Applicable tax and the expression “VAT included”
• Total amount

In case the invoices is issued to a business manager or self-employed professional, the following information must be added:

• Cif number and address of the client
• Percentage of VAT

 Term and language in which the invoice must be issued

Pursuant to article 11 of aforesaid Royal Decree 1619/2012, the invoices must be issued at the time of delivery of the sales or services. When the invoice is issued to to a business manager or self-employed professional, the invoices must be issued before the 16^th of the month following the month in which the corresponding tax is accrued.

The invoices may be issued in any language. But the Inland Revenue may require a translation into Spanish.

Do not hesitate to contact your fiscal advisers and economists at Arcos & Lamers Asociados for any questions on your fiscal, labour, commercial, legal and accounting issues.

María Teresa Arcos, lawyer in Marbella.

Wim Lamers, economist in Marbella.

Marbella, August 2013.

If you are a purchaser of a property in Spain and agree to a certain price with the vendor, you may receive from the corresponding Spanish Tax Office a “Complementary settlement”, once signed the Purchase and Sale Title Deed. Regional and National Inland Revenue may claim the settlement of the tax according to criteria established by law inSpain. The tax authority is empowered to review the values set by the parties freely.

In Andalucía, the Order of February 13, 2013approves the coefficients applicable to the cadastral values (rateable value) to estimate the real value of properties in order to settle additional bill´s with regards to the transfer tax and stamp duty, inheritance and gift tax inSpainand or the well know Capital Gain Tax. This Spanish law establishes the rules for applying them and the methodology used to obtain valuations on properties in Spain.

Imagine, you as purchaser of an already existing not newly built property in Spain, agree with the vendor a certain purchase price. This price is freely agreed by both parties that for all purposes is a market price, however you need to keep in mind that if that price is lower than that established by the regional law – the so-called tax/fiscal value -, you, the purchaser, will receive in a relatively short time since the signing of the Purchase and Sale Title Deed a “complementary settlement” claiming the difference in transfer tax originally paid, plus legal interest (and remote fines).

Take a practical example that allows you to understand the above:

Purchaser and vendor agree on a price of 100.000,00 euros for an urban property in the Andalusian municipally of Cuevas de Almanzora.

The rateable value of the property in the municipality is 45.000 euros and the multiplier applicable to this town for the year 2013 is 3,60. We find that the fiscal value of this property is of 162.000,00 euros, (45,000 x 3,60).

At the time of the signing of the purchase Title Deed, the Purchaser has paid the transfer tax to 8% over 100,000 euros = transfer tax liability of € 8,000.

Well, please be ensured that the Tax Office of the municipality of Cuevas de Almanzora, will send a “complementary settlement” requiring payment of the transfer tax on a total value of 162,000.00 euros, with a tax to be paid of 12,960 euros, discounting the initially tax of 8,000 euros, plus interest applicable.

The above would also be applicable to Inheritance and Gift Tax inSpainas well as the well known Capital gain tax in Spain.

Before proceeding with the purchase of a property and agree a price with the vendor, keep in mind that there are a number of values that may affect the taxes of the transaction. Do not hesitate to contact the leading multi-lingual law firm,Arcos & Lamers Asociadosfor any tax or legal matter in Spain.

Please do not hesitate to contact the English speaking Spanish lawyers and accountants in Marbella of Arcos & Lamers Asociados, your property lawyers in Spain and tax advisors in Marbella, in the event that you need professional advice regarding the matter proposed in this blog or any other that you may have at the time of selling or purchasing your property in Spain, we have an expert team ready to answer your questions and to provide legal and fiscal advice in Spain.

Arcos & Lamers Asociados, property lawyers in Spain, property lawyers in Marbella, property law firm in Spain, conveyancing lawyers in Spain, Spanish legal advisers.

Approach the English speaking Spanish Lawyers of Arcos & Lamers Asociados for any legal, tax, labour and company advice you may need!.

Félix Ruiz, lawyer in Marbella.

Marbella, June, 2013.

Income tax in Spain

Tax adviser in Spain informing on Spanish Income Tax.

The initial name of the Spanish income tax was “general contribution to Spanish income” (contribución general sobre la renta) , which was approved, long time ago, by the law of November 20, 1932, under the government of Mr. Manuel Azaña and as Minister of Finance Mr. James Carner Romeu. The law, which took effect on January 1, 1933, set a minimum exemption of 100,000 pesetas and tariffs from 1 to 7.70%.

By Act of November 14, 1935, as Minister of Finance Joaquin Chapaprieta, the free threshold was lowered to 80,000 pesetas and maximum rates were increased upto 11%, maintaining the minimum 1%. Several relevant amendments took place between 1940 and 1960. Central Spanish State reform in a decentralized state in the 90s resulted in more changes.

During the last decade additional changes have been introduced in the Spanish tax law leaving the following scales applicable for year 2012. With other words, the Income Tax declaration to be presented in 2013 that entitles income information obtained during 2012 will be taking into account the following scales:

As an example, a taxpayer, tax resident in Andalucía, with a gross income from work of  Euros 60,000 will mean a payment of Euros 9458.31 Euros taxed by the general national scale, Euros.1.314, 51 as per the above mentioned additional scale plus Euros. 9.458.31 as by the Andalucian regional scale, making a total of Euros. 20.231.13 with an average rate of 33.72%. Kindly note that this data is obtained regardless of the family status and is for informative purposes only as no deductions have been taken into account such as those generated at the time of contributions to Spanish pensions plans, contributions to Social security, etc..

Do not hesitate to contact the multi-lingual lawyers, accountants and tax advisers in Spain of Arcos & Lamers Asociados, specialists in the Spanish tax system, for any legal, tax and labour inquiry.

María Teresa Arcos, registered lawyer in Spain.

Wim Lamers, registered accountant (economist) in Spain.

Arcos & Lamers Asociados, Spanish tax lawyers in Marbella, tax lawyers in Spain, income tax in spain specialists, accountants in Spain, accountants in Marbella, tax advisers in Spain, tax advisers in Marbella.

Marbella, June, 2013.

Income tax in Spain

INCOME TAX FISCAL RESIDENTS IN SPAIN.

Pursuant to article 96 of the Spanish Income Tax law and article 61 of the regulation (reglamento) of the mentioned law, the following persons are required to submit the Income tax declaration of 2012 in Spain.

a) Taxpayers who have obtained an income in the year exceeding the amounts for each class or source that are highlighted below.

b) Those taxpayers in Spain who, regardless of the amount and nature or source of the income earned, would be entitled to a deduction for investment in there prime home, special savings account for the purchase of their first home, international double taxation, or have made contributions to individuals with disabilities, pension plans, insured pension plans, corporate pension plans, etc.

c) Taxpayers in Spain who are required to file the Spanish income tax and apply for the refund arising from the Income Tax regulation to which they are entitled if proceeds.

d) Taxpayers who are not required to file their Spanish Income Tax due to the amount and nature or source of their income earned during the year, but are applying for the refund arising from the Income Tax regulation in Spain.

Who is not required to file Spanish Income Tax at the Inland Revenue?

1. Taxpayers whose income is derived solely from the following sources, provided they do not exceed any of the limits mentioned in each case:

A) Gross salary out of work (including, among others, retirement pensions, including those from abroad, as well as non-exempt alimony and annuities for alimony) for an amount not exceeding:

• Euros 22,000 per year, generally.
• Euros 11,200 per year in the following cases:

a) When income is paid by more than one employer.

However, the limit is Euros 22,000 per year in the following cases:
1 ° where, the income is generated by more than one employer, the sum of the amount received from the second and other employers may not exceed the total amount of 1.500 Euros.

B) Income from immovable capital (non-exempt dividends, interest on accounts, deposits or fixed income securities, etc.) and capital gains (gains from reimbursement on shares in investment funds, prizes for participation in competitions or lottery, etc.), provided that the income has been subject to advanced tax payments and the overall amount does not exceed the amount of 1,600 euros per year.

C) Deemed Income Tax, income from immovable capital not subject to advanced tax payments arising from treasury bonds and subsidies for the acquisition of subsidized housing with a limit of 1,000 Euros per year.

For any legal or tax inquiry, do not hesitate to contact the multi-lingual tax lawyers of Arcos & Lamers Asociados, your Registered Accountants (economists), lawyers and tax advisers in Spain.

María Teresa Arcos, Lawyer in Spain.

Wim Lamers, Registered Accountant (Economist) in Spain.

Arcos & Lamers Asociados:Accountants in Spain, tax advisers in Spain, Spanish tax specialists, Income tax specialists in Spain, tax lawyers in Spain, Tax law firm in Spain.

Marbella, May, 2013

Income Tax in Spain

Due to many inquiries that the tax lawyers of our firm receive every year, the multi-lingual tax advisers of Arcos & Lamers Asociados, your accountant and tax adviser in Spain, would like to lay out the corresponding deadlines applicable on Spanish Income Tax.

This year 2013, the possible “online” submission of the corresponding Income tax and Wealth Tax for Tax residents in Spain started on 24th April.

26/06/2013 will be the last day for filing the Income Tax form stating an automatic direct debit on Spanish personal bank accounts.

28/06/2013 will be the last day to request “customer service” meetings at the corresponding Inland Revenue in Spain.
On the 01/07/2013 the Spanish Income tax campaign ends for 2012. Last day to file Income Tax returns 2012 and Spanish Wealth tax 2012.

The personal Income tax in Spain is considered as a direct, personal, subjective, progressive and analytical tax type.

The Income tax in Spain is straight forward and is directly calculated on the Income of the taxpayer, personal as the tax payer is liable himself and not the asset/s, subjective because it takes into account the physical and or personal condition of the tax payer; progressive, in the sense that a higher income will be taxed in a higher proportion; analytical, as the Spanish Income tax does consider different types of Income and does tax each different type of income in a different way.

Do not hesitate to contact the multi-lingual tax lawyers of Arcos & Lamers Asociados, your Registered Accountants (economists), lawyers and tax advisers in Spain specialized in the Spanish Tax system.

María Teresa Arcos, Lawyer in Spain.

Wim Lamers, Registered Accountant (Economist) in Spain.

Marbella, May, 2013

Accountant in Spain

Accountants in Spain.

Spanish multi-lingual proactive law firm, Arcos & Lamers Asociados, has recently launched, in addition to our weekly posts at our blog, a new micro web under the title “Accountants in Spain” providing deep going information on the Spanish Tax system, Spanish accountancy rules and tax advice that our firm provides to Spanish and north European communities, individuals and companies in Spain. Please find below a summary of the different areas we have taken into account providing answers to inquiries that our firm receives on a daily basis.

• Information to learn more on Spanish tax obligations to take into account after of constitution of your new company or on the accountancy obligations that your existing company should take care of. Additional information may be found here with regards to the Spanish fiscal system as well the accountancy services rendered by our firm.

• Information regarding Spanish company tax, Company Tax rates applicable for different types of companies.

• Specific information on reductions on Personal Income Tax in Spain for whom wish to start an activity in Spain.

• Information to take into account when your company is unable to collect debts from its clients as from an accountancy and tax point of view.

• Other services.

The professional team of Arcos & Lamers Asociados has an extensive knowledge on legal and tax issues and disposes of the material resources and the hands-on experience to attend to all your needs in accountancy, tax and legal matters in Spain

Do not hesitate to contact one of the registered professionals of this multi lingual law firm in Spain!.

María Teresa Arcos, lawyer in Spain

Wim Lamers, economist in Spain.

Marbella, May, 2013

Specifically chapter two of the mentioned law is including relevant reductions at the Spanish Income Tax. Of course, limitations on these reductions have been included as well. The reduction entitles a relevant decrease of 20% of the positive income generated. Congratulations!

Limitations to the mentioned reductions:

1)      That the individual who starts the activity has not carried out any activity for one year.

2)      The reduction of 20% is applicable for the first 100.000 Euros profit only.

3)      The reduction of 20% is not applicable in the event that more than 50% of the income is generated by the same client (individual or company) that was contributing previously to the Income out of Work (rendimientosdeltrabajo).

In Andalucía, the general Spanish scale with regards to the Income tax in Spain goes from 24,75%  up to 52,00%.

As a guide-line:

Addition information with regards to the reduction of Spanish Company tax that is appearing at the mentioned Spanish law 04/2013 can be found here .

The professional team of Arcos & Lamers Asociados has the legal/fiscal knowledge, resources, experience and skills to help clients deal with any matters related to the services listed below.

CIVIL LEGAL AND EXTRAJUDICIAL PROCEEDINGS
PURCHASE & SALE OF REAL ESTATE
TAX LAW: TAX AND ACCOUNTING ADVICE
CORPORATE LAW, TRADE COMPANIES
INHERITANCE, WILLS AND SUCCESSION
SPANISH EMPLOYMENT ADVICE
TRADEMARKS AND PATENTS
CRIMINAL LAW
BANKRUPTCY PROCEEDINGS
LEGAL AND FISCAL ADVICE IN GENERAL
OTHER SERVICES

Do you need an efficient registered accountant in Spain? Contact now, Arcos & Lamers Asociados, your multilingual registered accountants (economists) inMarbella, solicitors and lawyers inSpain under one roof!

This information has been published byArcos & Lamers Asociados, your registered accountants in Spain! The same is not legally binding as the above is for informative purposes only.

Marbella, April, 2013.

Bad Debts

Is your company having cash flow problems due to the delay of payments of your client/s? Invoices have been raised and VAT have been paid to Spanish Inland Revenue although your company has not got paid yet by its client/s?

Sara Duarte, professional English speaking Spanish accountant in Marbella of Arcos & Lamers Asociados is informing you on the way forward!.

At the present time many companies are suffering with Debts from which they are having difficulty to recover.  If this is happening with your Company you will need to now the following:

A debt can be considered a total or partial “Bad Debt” when all the following conditions apply:

1. That a full year has elapsed since the accrual of the output tax without the payment of all or part of the debt having been received.

2. The fact that this has been recorded in the books of the Company.

3. The supplier or recipient of the operation acts as a entrepreneur or professional. If this is not the case, the tax base (amount before vat) should be higher than 300,00 €uros.

4. That the tax payer has claimed the debt through a lawsuit or through a notary requirement.

The amendment should be made within three months following the end of the one year period referred to in condition 1 above and contact should be made with the Tax Agency in the period specified by regulation.

On completion of the reduction in the tax base, this change will not be reversed even if the taxpayer should obtain the total or partial payment of the debt, unless the debtor is not acting in the capacity of an entrepreneur or professional.

Arcos & Lamers Asociados, Your accountant and tax adviser in Spain!. Accountants in Marbella, Málaga, Spain.

Marbella, April, 2013.