🇪🇸 How Business Tax Works in Spain
Spain’s corporate tax system requires strict and recurring filings throughout the year. Whether your company is newly incorporated or well-established, failure to file correctly can result in penalties, audits, or legal exposure.
✅ Corporate Income Tax: Flat rate, mandatory filing
✅ Withholding obligations: for salaries, leases, contractors
✅ Quarterly + annual filing cycle
✅ Local vs. non-resident tax distinctions
🧾 What Taxes Do Businesses Pay in Spain?
| Tax Type | Applies To | Rate / Frequency |
|---|---|---|
| Impuesto sobre Sociedades (IS) | All SL companies (resident or not) | 25% (15% for new companies) |
| IRPF Withholding | Employees, freelancers, landlords | 2%–47% depending on income |
| IVA (VAT) | Sales of goods/services (in Spain/EU) | 21%, 10%, or 4% depending on goods |
| Business Activities Tax (IAE) | Businesses earning over €1M/year | Variable, usually exempt initially |
📌 SLs and branches must also file informative returns, even if no activity occurred.
🧮 Corporate Tax (IS) and Modelo 200
Every Spanish company must file Modelo 200 (corporate income tax return):
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Deadline: 25 July for calendar year taxpayers
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Covers: income, expenses, depreciation, deductions
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Flat rate: 25% on net taxable profits
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Reduced rate: 15% for newly formed companies (first 2 years with profit)
💡 Even if your company makes zero profit, you must file — it’s a legal obligation.
📅 Key Business Tax Deadlines in Spain
| Tax Return | Frequency | Form / Modelo |
|---|---|---|
| Corporate Tax (IS) | Annual | Modelo 200 |
| VAT (IVA) | Quarterly | Modelo 303 |
| Annual VAT Summary | Yearly | Modelo 390 |
| IRPF Withholding | Quarterly | Modelo 111, 115 |
| Annual IRPF Summary | Yearly | Modelo 190 |
| Related-Party Ops | Yearly | Modelo 232 |
| Client/Supplier Info | Yearly | Modelo 347 |
Failure to file any of the above may trigger automatic fines, even without profit or VAT liability.
📎 Do You Need to Pay Taxes if You Have No Income?
Yes — all SL companies must file returns, even if inactive. You must:
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File Modelo 200 with zero profit
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File Modelo 303 / 390 if VAT-registered
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Report employee/freelancer withholdings, even with €0 paid
📌 Penalties for non-filing can exceed €1,000 even if no tax is due.
⚖️ Special Tax Considerations for Foreign-Owned Businesses
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Non-resident company directors may trigger withholding complications
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Intra-group payments (management fees, loans) must be disclosed via Modelo 232
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Foreign income is generally taxable unless structured properly
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Holding companies can reduce double taxation with proper planning
💡 We offer international tax structuring support to optimize this.
❌ Common Tax Filing Mistakes to Avoid
⛔ Using foreign accounting formats
⛔ Missing quarterly filings due to calendar confusion
⛔ Ignoring Modelo 190 / 390 / 347 summaries
⛔ Forgetting to report related-party transactions
⛔ Assuming “no activity = no filing”
🧑💼 Our Business Tax Services in Spain
At Borderless Lawyers, we handle:
✅ Full corporate tax returns (Modelo 200)
✅ VAT and IRPF quarterly returns
✅ Withholding tax compliance (Modelo 111, 115, 190)
✅ International structuring for tax efficiency
✅ Filing zero-activity returns to avoid fines
✅ Advisory for startups, remote owners, and family businesses
📞 Stay Compliant with Spanish Business Tax Law
Filing taxes in Spain doesn’t need to be overwhelming. Our team helps you meet all obligations, optimize your structure, and stay ahead of deadlines.
👉 Contact us for complete business tax filing and compliance in Spain.