Characteristics	Portfolio Content	
General	
Revenue authority	 Agencia Estatal de Administración Tributaria  (AEAT) (Section I.B.2.)  	
Type of tax system 	•	Residents: Worldwide income (Section V.A.)
•	Nonresidents: Spanish-source income (Section VI.B.1.)
	
Residence 	A company is tax resident in Spain if:
•	It is incorporated in Spain; 
•	Its registered office is in Spain; or
•	Its place of effective management is in Spain.
(Section V.A.2.a.)

An individual is tax resident in Spain if:
•	The individual is present in Spain for more than 183 days during the calendar year;
•	The taxpayer's main center of economic interests is located in Spain; or
•	The taxpayer's spouse and minor dependents are resident in Spain.
(Section X.A.2.a.)	
Basic domestic nexus rule for foreign corporations 

	A nonresident company is subject to corporation tax on the worldwide income attributable to its activities if it carries on a trade in Spain through a permanent establishment.

A nonresident company operating in Spain without a permanent establishment is subject to nonresident income tax on its Spanish-source income and is generally taxed on the gross amount received. (Section VI.B.1.)
	
Treaty network	Spain concluded tax treaties with over 100 countries, including the United States. (Section XVI.A.)

MLI signatory: Yes. (Section XVI.A.)

For the texts and status of Spain’s tax treaties, see International Tax Treaties.

Corporations	
Corporate income tax rate	Corporate income tax:
General rate of 25%. There is a minimum 15% tax rate for large companies. (Section V.A.7.a.)

Nonresident income tax:
Flat rate of 24% for business income of a foreign company without a Spanish PE. Reduced rate of 19% for EU residents or residents of EEA countries that have an effective exchange of tax information with Spain. (Section VI.C.1.)

Investment income (dividends and interest) and certain capital gains are taxed at 19%. (Section VI.C.2.)
	
General withholding tax rates on payments to non-resident companies	•	Dividends: 19% (Section VI.C.2.a.)
•	Interest: 19% (Section VI.C.2.b.)
•	Royalties: 24%, reduced to 19% when paid to EU residents or residents of EEA countries that have an effective exchange of tax information with Spain. (Section VI.C.2.c.)

For the rates of source country taxation applying to investment income, services income and capital gains under Spanish domestic law and tax treaties and the context for the application of those rates, see the Withholding Tax Chart.
	
Net operating losses carry back/forward	Carryback: Not allowed (Section V.A.6.)

Carryforward: Indefinite, subject to limitations (Section V.A.6.)	
Restrictions on deductibility of interest expenses 	Yes, generally limited to 30% of a company's or group's EBITDA, subject to a threshold of 1 million euros of net interest expense per taxable year. Interest payments on profit-participating loans are nondeductible. Borrowing costs related to an acquisition of shares in excess of 30% of the operating income of the acquirer for the period are not deductible if the acquired entity is subsequently included in the tax group of the acquirer or merged with the acquirer. (Section V.A.5.b.)	
Anti-Hybrid mismatch rules	Yes (Section V.A.5.q.(2).)	
Incentives (major)	Generally, yes (Section V.A.7.b.(6).(b). and Section V.A.8.)
•	R&D: Yes (Section V.A.8.e)
•	Patent box: Yes (Section V.A.4.f.(1))
•	Enhanced depreciation / capital allowance: Limited free depreciation and amortization regime for certain assets including R&D-related assets (Section V.A.5.f)
•	Environmental: N/A
•	Other: Film Productions and Performing Arts and Music Tax Credits (Section V.A.8.f)	
Participation exemption (or similar regime)	Yes, a 95% participation exemption can apply for dividends and certain gains and interest subject to conditions (Section XVI.C.1.a). There is also a dedicated holding company regime, ETVE (Section V.A.7.b.(5).)	
Tax consolidation	Corporate taxpayers can opt to be taxed on a consolidated basis, irrespective of whether they consolidate for accounting purposes. (Section V.A.11.)	
M&A regime	Tax-free or tax-privileged transaction: Special tax neutral regime based on the tax regime of the EU Merger Directive applicable to certain corporate reorganizations. (Section V.A.12.)

Stamp duty/share transfer taxes: Yes, a Financial Transaction Tax (Section V.B.8) may apply to transfers of certain shares. Stamp Duty does not apply to shares.

Limitation on pre-deal NOL carryforwards: No	
Pillar One and Two	Pillar Two: Legislation adopted implementing Pillar Two. (Section XV.D.2.)	
Controlled foreign company regime	Yes (Section XV.C.)	
Transfer pricing regime	Yes (Section XIV.)

Country-by-country report: Yes (Section XIV.D.4.)

See also Chapter 150 of 6970 T.M., Transfer Pricing: Rules and Practice in Selected Countries (Q-S) 	
Mandatory disclosure regime	Yes (Section XVI.B.)	
Foreign tax relief 	Participation exemption (Section XVI.C.1.a.); foreign tax credit (Section XVI.C.1.b.). While some of Spain’s tax treaties provide for exemption with progression, this is in the process of being abolished and replaced with the credit method, where possible. (Section XVI.C.2.)	
Individuals	
 Personal income tax rates 	Income tax payable by a resident individual is a combination of national and regional tax rates on both ordinary and savings income. The national tax rates apply to 50% of a taxpayer’s ordinary income (at progressive rates ranging from 9.5% to 24.5%) and the regional tax rates apply to the remaining 50% (at progressive rates). Since the regions apply different tax rates and tax credits, the combined effective income tax rate on a resident individual will vary depending on the region in which the individual resides. 	
Equity incentives	Yes (Section X.A.3.b.(1).(a).)	
Foreign tax relief	Yes (Section X.A.6.g.)	
Wealth tax 
Inheritance tax and gift tax	•	Net worth tax (Section X.B. and Section XI.B.)
•	Inheritance and gift tax rates are generally set out in the tax legislation of the competent region. (Section XII.D.1.)	
Exit taxes	Yes (Section X.A.3.b.(4).(c).)	
Other Taxes	
VAT/GST/Sales tax 	VAT is charged at a standard rate of 21%. (Section XIII.G.)

There is no VAT registration threshold in Spain. (Section XIII.A.2.b.(2).)

For further research on the Spanish VAT system, see also the VAT Navigator.	
Digital services tax 	3% digital services tax is levied on the provision of online advertising services, online intermediation services and data transmission services that derive value from Spanish users. (Section IV.F. and Section V.B.9.)	
Local taxes 	Compulsory taxes levied by all municipalities (including business activities tax, real property tax and motor vehicle tax) and optional local taxes (such as taxes on construction, urban land appreciation or luxury expenses). (Section V.B.10.)	
Administrative	
Standard tax return filing date 	Corporate Income Tax Return: within 25 days after six months following the close of the taxable year. (Section V.A.9.b.)

Individual Income Tax Return: between May 1 and June 30 following the relevant year of assessment, as per the annual ministerial order. (Section X.A.7.c.)
	
Limitation period for assessment	•	Audit and assessment of taxes; tax collection; imposition of penalties; taxpayers’ right to claim tax refunds: 4 years from the day following the end of the voluntary tax filing period.

•	Criminal prosecution: 5 years

•	Net operating loss (NOL) offsets, carryforwards and tax credits: 10 years
(Section V.A.10.e.)
	
Advance tax rulings. 	Yes. Tax rulings are binding on the AEAT, not only with respect to the taxpayer who requested the ruling but also with regards to any other taxpayers in the same circumstances. (Section IV.A.2.)