Tax systems

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10. Taxes
This is a topic on which foreign researchers in Spain should find general information and understand useful concepts in advance. The Spanish Tax Agency [ES] is responsible for applying the national tax system. Its website is very complete.

Individuals and legal entities in Spain are given a tax identification number for all tax-related matters. For non-Spanish citizens, this numberis the same as the personal foreigner identification number that is assigned to them.

10.1. Direct and indirect taxes

There are two types of taxes in the Spanish tax system: direct and indirect. Direct taxes are applied to income earned and assets. They include the Personal Income Tax (IRPF), Non-Resident Income Tax (IRNR), Corporations Tax, Inheritance and Donations Tax and Wealth Tax.Indirect taxes are applied to goods and services and the transfer of goods and rights in general. They include the Value Added Tax (VAT), Special Taxes (IIEE), Insurance Premiums Tax and Wealth Transfer Tax (ITP).

Foreign researchers who come to Spain for a limited period of time will probably have to pay IRPF or IRNR, depending on their residence status, VAT, IIEE and, in rare cases, Wealth Tax,ITP, etc.

IRPF and IRNR

These taxes are applied to income earned by individuals, depending on their residence status.

Residence

Individuals must pay Personal Income Tax (IRPF) or Non-Residents Income Tax (IRNR), depending on whether or not they are residents of Spain.

Individuals are considered to maintain a regular residence in Spain when the remain in the country for over 183 days(6 months) during the calendar year. Sporadic absences are taken into account when determining a presence in Spain, unless they certify their residence for tax purposes in another country. However, there are certain considerations, such as their family's place of residence, personal relationships and close economic ties, country of origin or where they normally work. People in this situation must,in principle, pay IRPF on all income anywhere in the world. It is therefore a good idea to seek out information on your tax status when you come to work or research in Spain.

Special IRNR tax plan

Individuals (in this case, researchers) who establish residence for tax purposes in Spain as a result of their travels to this country may choose to pay the IRNR, maintaining their IRPF taxpayerstatus, for the tax period in which they move their residence and the following five tax periods. This is possible provided that:

They have not been residents in Spain during the ten years prior to this new journey to Spain
Travel is in conjunction with an employment contract
The work is actually carried out in Spain and for a company or entity residing in Spain or for a permanentestablishment in Spain for an entity that does not reside in this country
The compensation for the work done in conjunction with this employment relationship is not exempt from IRNR tax.
Certification of residence for tax purposes

A person can have a residence permit or administrative residence in a country without being considered a resident for tax purposes. To be a resident for tax purposes in aparticular country (in this case, Spain), the person must be subject to taxation on income earned anywhere in the world. Residence for tax purposes is certified with a certificate issued by the country's Tax Authority. These certificates are valid for one year.

Agreements to avoid double taxation

If the researcher is a resident of a country with which Spain has signed an Agreement to avoid doubletaxation, the terms of the agreement will apply, since, under circumstances, the income cannot be taxed in Spain. In these cases, the non-resident researcher must certify residence in the country with which Spain has signed the Agreement by means of a residence certificate issued by that country's Tax Authorities.
To find out what types of agreements Spain has signed, and with which countries,...
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