ESP: Current legal issues
After several quarters of slow recovery, the Spanish economy became intensely vulnerable to deterioration in the euro zone and plunged back into recession during 2011. Through the R.D. Law 20/2012, July 13, (B.O.E. 14/07/2012), relating to measures to guarantee the budgetary stability and promote the competitiveness, the Central Government seeks to recover the path of stable economic growth in Spain.
Among the measures approved in it, It’s necessary refer to the amendments to the Value Added Tax (I.V.A./V.A.T.), Corporate Income Tax (I.S.), and the Personal Income Tax (I.R.P.F.).
1) Amendments relating to the Value Added Tax (V.A.T.):
- General VAT rate goes from 18% to 21%, and certain products and services taxed at a reduced rate passes it to the general rate of 21% (flowers and ornamental plants, mixed service of catering, entertainment, nightclubs, entry to theaters, circuses, other entertainment, services rendered by individuals artists, funeral services, hairdressing services, digital television services, acquisition of works of art, etc.).
- Reduced VAT rate passes from 8% to 10%. This type is the one that applies to food, except for commodities or necessities, water, drugs for animal use, prescription glasses and contact lenses, housing, hotel and restaurant services, library and museum entry, certain works of renovation and home repair, construction or rehabilitation of housing, etc.
- Super-reduced VAT rate remains at 4%. This type is the one that applies to goods and services with regards to staple food: bread, milk, cheese, eggs, fruits, vegetables, books, newspapers, medicines for human use, vehicles for disabled, hearing aid, social housing, telecare services to people living in dependency.
- Purchase of new homes: Is maintained until 31/12/2012 the super-reduced VAT 4%. As of 01.01.2013 the reduced rate will apply 10% VAT.
- Renovation and reparation works performed in homes or apartment buildings are taxed at the reduced rate VAT 10%, if certain requirements are met. From 01/01/2014 on, those will be taxed with a rate of 21% in most of cases.
2) Amendments relating to the Corporate Income Tax (I.S.):
- During the years 2012 and 2013, the loss carried forward for entities with a turnover in excess of twenty million euros is limited.
- Temporary increase of partial payments. The minimum amount is raised from 8% to 12%.
- Extension of the limitation of deduction for financial expenses and extending it to all companies in general, not limited to the
membership of a group.
- New rate of 10% on income from foreign sources, exclusively until 30/11/2012.
3) Amendments relating to the Personal Income Tax (I.R.P.F.) :
- Withholding tax of 21% (instead of 15% now) applied from 01/09/2012 until 31/12/2013 to yield for professionals (i.e. architects, doctors, lawyers, and other activities falling under Sections 2 and 3 of the law for taxation of economic activities (Impuesto sobre Actividades Económicas), and earned incomes obtained teaching courses, conferences, seminars and similar. It is expected that as of 2014 the withholding tax will be determined at 19%.
- Certain works of renovation and repair performed in homes: As of 01/01/2014, the deduction of up to 20% with regard to personal income taxation is eliminated.
Date of entry into force of the R.D. Law 20/2012: 15/07/2012.
The law firm was established in 2003 by Dr. Artur Bunk, an Attorney-at-Law. Qualified in 1995, he was admitted to the Frankfurt Bar in 1997 after obtaining an LL.D. in European Law at the University Viadrina in Frankfurt (Oder). During his career he has worked with the German law firm Pünder, Volhard, Weber & Axster (now Clifford Chance), was Head of Office at Rödl & Partner in Poland, and Senior Legal Counsel at the Legal and Restructuring Department of KfW. In addition to German, he also speaks fluent English and Polish.
Our offices are based around 45 minutes from Frankfurt/Main International Airport in and approx. the same distance from Frankfurt City.
Thanks to the professional experience and background of our Principal and our Attorneys we are in a position to meet the highest requirements and expectations of international clients, which forms an integral part of our business philosophy, enabled us to establish a profound know-how base on international matters unmatched by law offices of comparable size and background. With our network of external consultants (auditors, tax advisors), we are well equipped to perform advisory services usually only found in much larger law offices. Our comparatively low overheads and flexibility enable us to provide our services on a competitive basis.
bunk-alliance has established a close cooperation with law offices in Italy, India, Poland, Slovakia, with auditors and tax advisory offices in Germany and Poland and various governmental agencies.
Phone: +49 6241 97249 0
Fax: +49 6241 97249 11
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