Corporate Consultancy

News Letter

ON-LINE COMPULSORY COMMUNICATION FROM SPANISH TAX ADMINISTRATION AGENCY (AEAT) AND SPANISH DIRECTORATE GENERAL OF TRAFFIC CONTROL (DGT)

As of January 1, 2011 letters / notices in paper form (many of them certified) that were received from the AEAT (Spanish Tax Administration Agency) shall almost completely disappear and so they will begin to be received by means of Internet through an email address.

Last Tuesday November 16, 2010 was published in the Spanish Official Gazette (BOE) the "Royal Decree 1363/2010 of October, 29th by means of which compulsory administrative notifications and communications by electronic means within the scope of Spanish Tax Administration Agency are governed" The main novelty introduced by this Royal Decree is compulsory nature on reception of notifications and communications from AEAT through telematic or electronic means.

It also becomes mandatory for companies that have vehicles in their assets. These companies will be forced to enable an email address on the web dgt.es; otherwise, notifications can be made by public edict or proclamation.

Who are the REQUIRED?

Those forced to receive notifications telematically are:

  • Corporations (with Spanish Tax Identity Number –NIF- starting with A),
  • Limited liability companies (with Spanish Tax Identity Number –NIF-starting with B)
  • Legal persons and unincorporated entities that lack of Spanish nationality (with Spanish Tax Identity Number –NIF-starting with N)
  • Permanent establishments and branches of non resident in Spanish territory entities (with ID starting with W)
  • The Temporary Business (Spanish UTEs) (with Spanish Tax Identity Number –NIF starting with U) and
  • Entities with NIF begining with letter V and corresponds to one of the following types:

Economic Interest Grouping, European Economic Interest Grouping, Pension Fund, Equity Fund, Global Asset Securitisation, Mortgage Market Adjustment Fund, Mortgage Securitisation Fund or Investment Guarantee Fund

In addition to the above entities, regardless of their personality or legal form, the following persons or entities:

 

  • Those that are registered at the Register of Large Companies
  • Those that have opted for taxation in the Tax Consolidation Regime,
  • Those that have opted for taxation in the Special Regime Group of Entities,
  • Those that were registered at the Register of monthly return, and
  • Those that have an existing and valid authorization of the Department of Customs and Special Tax at the AEAT for the submission of customs declarations by means of electronic transmission of data system (EDI).

 

NON TELEMATICS COMMUNICATIONS

In no event the following communications and notifications, among others, shall be performed telematically:

 

  • Those that enclose elements which are unsuitable for conversion into electronic format.
  • Those that must be carried out personally at the tax domicile of the tax obligor/tax debtor/taxpayer or at any other place.
  • Those effectuated by the AEAT while handling processes related to economic and administrative claims.
  • Those that contain means of payment in favor of the tax obligors/tax debtors/ taxpayers, such as checks.
  • Notifications of accounts’ seizures to financial institutions.

 

AEAT may carry out notifications by non-electronic means in the following events:

 

  • When the tax obligor/ tax debtor or his representative requests the communication or notification to be carried out personally at the offices of the AEAT.
  • When electronic notification or communication is inconsistent with the immediacy and expeditiousness required by administrative action to ensure its effectiveness.

 

INCLUSION IN THE ENABLED E-MAIL ADDRESS SYSTEM AND ITS OPERATIVE RUNNING

AEAT shall notify tax obligors, by non-electronic menas (probably one of the last communications to be received in paper format) its inclusion in this system, by providing a sole e-mail adress.

When the unique e-mail address is enlisted at AEAT’s portal, we will have to introduce an e-mail adress, which shall be associated to that account. Each time that AEAT notify us of any procedure, we will receive an email that shall alert us of the existence of such notification.

To sign and collect such communication or sign it and reject it, we shall have access to the sole email address by means of the appropriate electronic signature. After 10 days from the provision of said communication in the corresponding email address without having had access to its content, the notification shall be deemed rejected, having all the consequences of what a rejection involves.

 

WE CAN HANDLE THESE STEPS FOR YOU

 

Requirements for Natural persons:

 

  • For Natural persons: having the electronic DNI (Spanish National Identity Card Number) or a digital certificate.
  • For Legal persons: having a digital certificate.

 

In order to have access to notifications, the certificate or the electronic DNI (Spanish National Identity Card Number) is required.

 

Digital Certificate for Corporate Bodies persons:

To obtain this certificate we do estimate a cost of 300 euros, depending on the final steps to be carried out. In any case the presence of the director or manager will be required at least once, or otherwise, special powers should be granted (the cost of which is not foreseen in the process).

 

LOANS BY OFFICIAL SPANISH CREDIT INSTITUTE (ICO)

 

At this time of crisis there are some funding lines available, including, among others, ICO’s lines, with many opportunities to succeed with a good approach for obtaining funds for your business:

 

ICO’s Direct Loan Facility.

 

Operations up to 200,000 euro.

 

- Aim: investment or liquidity

 

- Term:

 

- Investment at 7 years with a two-year grace period.

 

- Liquidity at 3 years with a one-year grace period.

 

- Interest Rate: EURIBOR + 3.5% annual at 6 months.

 

- Opening Commission: 0.5% with a minimal of 60 euro.

 

ICO-SGR

 

Operations between €200,001 and €600,000 euro. It can also be applied by companies and professionals with less than a year of seniority, in which case the amount applied for may be ranged between €0 and €600,000 euro.

 

Same conditions as Direct ICO.

 

We do carry out the formalities with the best chance of success for you. Contact us for analysing and planning of the operation to measure for you.

 

HOUSING

 

With regard to housing, all the changes that will occur in 2011 –which, therefore, may affect our current decisions- can also be added to decisions that can be taken in this fiscal end.

 

With regard to the deduction for the purchase of usual home, as of January 1, 2011, two systems shall coexist, and both of them are to be applied depending on whether the acquisition of usual home is prior to 1.1.2011 or later. 

 

If the purchase of the usual home occurs before 01/01/2011, then we will apply the deduction system existing up to nowadays, which allows us to deduct 15% of the amounts paid during the year with a limit of €9,015. This deduction will be also in force for all those who have delivered quantities on account for the purchase of their usual home, and of course tax compensation shal be maintained for those who acquired their usual home before 20/01/2006.

 

If the purchase of the usual home is made from the 01/01/2011, only those who have a tax base less than € 24,107.20 will be entitled to apply for such deduction of usual home, so that the maximum deduction will be for those who have a tax base equal to or exceeding €17,707.20, and they will deduct a 15% of a limit of €9,040, and gradually deduction in reverse shall apply up to €24,107.20.

 

Hence, if our idea is to acquire a usual home we should expedite all possible processes in order to execute the sale before 01/01/2011, given that the new deduction system is much more restrictive.

 

However, the deduction for renting the usual home is equal to the deduction system for the acquisition of usual home. As a result, this option is actually boosted, as it is also taken into account that the net return for rental housing is reduced in 60% (previously was of 50%) for the lessor, and its tax base is further reduced.

 

If the lessee is aged between 18 and 30, and his income is above IPREM, his reduction will be of 100%.

 

NEW REDUCTION FOR WORKS

 

In addition, since mid-April this year a new deduction of 10% of usual home improvement works has started to be implemented, but it is inconsistent with the deduction for investment in usual home for the same amounts. However, you can profit from it when you do not meet the requirements of the deduction for housing investment by taxpayers with incomes up to 53,007.20 per year.

 

This deduction is applicable both in usual home and in the building in which it is located, for works carried out between April 14 this year and 31 December 2012, adressed to improve energy efficiency, ceilings and sealing, sanitation, access to the Internet and DTT, all electrical, water or gas facilities, housing adaptation for disabled people, or improving accessibility.

 

MODULES REMAIN FOR THE YEAR 2011

 

Upon approval by the Spanish Ministry of Economy and Finance, the Government Official Gazette (BOE) of November, 30 discloses the Ministerial Order that develops the method for objective assessment of Income Tax and VAT Simplified Special Regime.

 

The new regulation holds in general, according to Spanish Treasury, the structure of the one in 2010 and maintains applicable modules this year as well as the reduction of 5 percent over net income of modules.

 

Thus, these are major changes that might be worth looking at in order to optimize your tax bill.

 

We do reiterate our availability for any clarifications that you might need.

 

NEW SECTIONS OF INCOME TAX, INCREASE OF SAID TAX ESCALATION AND CHANGES IN SICAVS (acronym for Spanish “Sociedad de Inversión de Capital Variable - Joint Stock Company)

 

In Spain, there will be two new sections in the current general rate, from €120,000 and €175,000.20.

 

And with respect to SICAV, some changes have been implemented with effect from 23/09/2010; reductions of capital with a return of contributions and distributions of issue premium shall tax and shall be taxed as dividends (Income from Capital), but shall not apply the exemption of the first €1,500.

 

Refunds of issue premium are fully taxed, and capital returns have a limit which is the larger of two amounts:

 

-The increase between the purchase price and the amount at the time of the reduction on capital.

 

-When reduction comes from undistributed profits, the value of those profits.

 

All that exceeds these limits will be deducted from purchase price of the shares and the excess shall be taxed as Income from Capital.

 

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