Tax Considerations When Launching in Spain

Tax planning should be integral to your Spain market entry strategy. The Spanish tax system offers both challenges and opportunities for foreign investors.

Corporate Income Tax

• General rate: 25%
• New companies: 15% for first two profitable years
• Small entities: 23% (turnover below €1 million)

Value Added Tax (IVA)

• Standard: 21%
• Reduced: 10% (food, transport, hospitality)
• Super-reduced: 4% (bread, milk, books)

Withholding Taxes

Spanish companies must withhold tax on various payments including dividends (19%), interest (19%), and royalties (24%).

Transfer Pricing

Transactions between related parties must be at arm's length. Documentation requirements are extensive for larger groups.

Beckham Law Benefits

Individuals relocating to Spain may opt for the special expatriate tax regime with a flat 24% rate on Spanish-source employment income.

Need personalized tax advice? Contact our fiscal team.