If your company is foreign and wants to operate in Spain, taxation is an issue that you cannot leave to chance. It’s not just about paying taxes, but about doing it right, avoiding unpleasant surprises and ensuring that everything is in order from the start. Good tax planning for non-resident entities in Spain will save you headaches (and money).
Before you worry about taxes, you need to be clear about what your business will do here. It is not the same to sell products, provide services or manufacture something. Depending on the activity, taxation changes and so do the obligations.
For example, if you sell products without an office or employees, you may only need a fiscal representative. But if you have a factory or an office, things get more complicated and you may need a more robust legal structure.
Your company can operate in Spain in several ways. Depending on the level of presence you want to have, there are three main options:
If you only sell or provide services sporadically, you may only need a tax representative. This is someone who makes sure you comply with your tax obligations without the need to open a branch or subsidiary.
If you want a stable presence but without setting up a new company, a branch may be the option. It is not an independent entity, but it is taxed in Spain for what it earns here.
If you want to operate in the long term and with total independence, the best option is to create a subsidiary. This means opening a Spanish company that will have its own tax and accounting obligations, but also more advantages to operate locally.
If you operate in Spain, there will be taxes. Some of the main ones are:
If your company earns money in Spain without a permanent establishment, it will be taxed on each transaction. If it has a stable presence, it will be taxed as a resident company.
If you have a subsidiary in Spain, it will pay corporate tax (normally 25%). Depending on the activity, there may be tax reductions or benefits.
If you sell or provide services here, you will probably have to register for VAT. Sometimes you will need a tax representative to handle this.
It is not enough to just come in and start trading. Good tax planning will help you avoid penalties, reduce costs and maximise profits. Some key points to review:
By Manuel Urrutia |
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