Claire Wilson
BUSINESSES with a turnover of less than 10 million euros will be entitled to a tax break on 10% of their profits from this year.
Around 385,000 will be affected by the change, saving an aggregate 600 million in tax for 2014, the Ministry of Finance has announced.
The move is one of a number of tax-related changes coming into effect this year in a bid to kickstart the floundering Spanish economy.
Those looking to invest in start-up businesses, so-called business angels, will also benefit from a 20% income tax reduction on the investments from a minimum 50,000 euros. They will be exempt from capital gains tax when they leave the company if they reinvest in a new one or one which has been recently created.
The most widespread change is that being made to IVA; companies can delay its payment until after the invoice has been paid.
The regulation applies to small and medium sized businesses, and those that are self employed whose turnover is below two million euros a year.
Those wishing to take advantage need to register before March 31, and thereafter every December, with validation applying for three years.
Good idea to save 10% on your tax etc, but don’t most small businesses under declare more than 10% anyway, how many small businesses do you know offer to do work without an IVA invoice? that’s a saving of 21%.
what a load of rubbish and as Yogi says most small businesses under declare already anyway. How about addressing situation of the business that have been run for years at losses while the owners live in huge house, drive big cars and have their children in private education. i try and do things right and on the right side of the law but constantly lose trade to my competition who under cut me doing work for cash and employing staff without contracts. Where i live there is a bar that is cheap and is busy yet i know the owner hasnt paid stamp for 3 years and has never employed anyone on a contract, he has 6 people working for him at the moment and is only busy because he is so cheap which he is able to do as he is not paying social security or stamp etc. This bar is not hidden away but constantly gets away with it. The government need to target small businesses like this as there 100s and to try reward the small business that pay tax/social securtiy rather than target them as they obviously have money so can pay fines
This year has seen some big shakeups in the tax dept.
In brief, small businesses will have to pay MORE tax.
Of course, those businesses that dont declare, or simply ignore paying taxes wont be affected. And the rest of us are screwed even tighter.
Its globally known spain is the worst country in the world for startups – and this is easily verifible. I wish i’d never set foot here: the corruption, the bureaucracy, the never ending stream of bent politians, the take it or leave it attitude. As soon as i make back my investment i’m off.
A delay in paying IVA if you jump through many hoops, regularly. Whoop-de-doo.