SPAIN Law and Practice Contributed by: Marta González-Llera, Toni Barios, Jorge del Castillo and Rafael Baena, Cases & Lacambra
Under certain circumstances, the transfer of Spanish companies owning real estate in Spain by foreign individuals could be exempt from tax - ation by application of a Double Taxation Treaty. Non-resident individuals are subject to non-res - ident income tax at a 19% or 24% rate for the mere ownership of real estate located in Spain. The relevant tax burden is calculated by deter - mining a notional income linked to the cadastral value of the relevant property. Finally, the ownership of real estate by a non- resident could be liable to wealth tax under cer - tain circumstances and, in tax years 2023 and 2024, liable to the temporary solidarity tax on major fortunes. 8.5 Tax Benefits Spanish companies subject to corporate income tax have the right to deduct the depreciation of construction contributing to economic activi - ties. Depreciation expenses are allowed in the corporate income tax taxable base if they are accounted for in accordance with the deprecia - tion rates set forth in the corporate tax law. Cer - tain accelerated amortisation schedules may be of application provided certain specific require - ments are met.
Spanish individuals who derive rental income may be entitled to deduct certain expenses from their personal income tax due, such as the relevant real estate asset depreciation. In addi - tion, the rental income of dwellings may benefit from a 60% reduction on the personal income tax due. Certain tax benefits apply to different regulated Spanish real estate vehicles. Furthermore, the Spanish Corporate Income Tax Law set forth a special tax regime for enti - ties involved in the rental of dwellings located in Spain, provided that, among other requirements, these entities own and operate at least eight dif - ferent dwellings during a period of three years.
871 CHAMBERS.COM
Powered by FlippingBook