Tax Newsletter - February 2020
Spain -
Form 720: Shares listed abroad are reported at market value
Directorate General for Taxes clarifies how shares listed on a regulated foreign market similar to the Spanish market have to be reported on Form 720. The resolution may have implications for wealth tax.
Judgments
- Corporate income tax.-Interest on participating loan not deductible if it actually implies a contribution to the borrower’s equity (legislation prior to 2015)
- Personal income tax.- The employer has to substantiate that paid per diems relate to work-related travel
- Nonresident income tax / investment funds.- Law laying down requirements for exemption on dividends to apply to investments funds does not constitute restriction on free movement of capital, unless it discriminates against nonresident funds
- Tax on stock exchange transactions.- It is not a restriction on the freedom to provide services for the legislation on the tax on stock exchange transactions to establish differences depending on the residence of the professional intermediary.
- Transfer and stamp tax.- UTEs are taxable persons for stamp tax
- Transfer and stamp tax.- The transfer of shares in real estate developers or construction companies is exempt, even if their corporate purpose is broader (article 108 of the Securities Market Law in force until 2012)
- Management procedure.- The tax authorities cannot systematically impose obstacles on the taxpayer for procedural reasons to avoid recognizing entitlement to a refund of incorrect payments
Decisions
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Personal income tax.- The reduction for rental of a dwelling is applicable regardless of its characterization in the Urban Leasehold Law
- Inheritance and gift tax.- A reduction recognized in a procedure commenced as a result of a return may be questioned in a later audit
- Tax on economic activities.- Commencement of a residential property rental business is exempt from the tax on economic activities, even if the company had previously been renting industrial premises
- Cadastral appraisals.- It is not valid to substantiate the construction categories for a building by simply transcribing the comparative methods for appraising values
- Tax resolutions.- Requests for resolution submitted by third parties to the DGT after an audit has commenced have binding effects for the person being audited
- Management procedure.- Waiver of refund in favor of the public treasury cannot be corrected
Resolution requests
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Corporate income tax.- The transfer of tax losses in a spinoff under the neutrality regime is only restricted by any impairment losses that were deductible
- Corporate income tax.- Not-for-profit entities may use the capitalization reserve and claim credits
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Corporate income tax.- An expense incurred by not requesting refund of VAT incurred abroad is not deductible
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Personal income tax.- Tax on late-payment interest received and later refunded to the public finance authority is only recovered by filing a correction return
- Personal income tax and inheritance and gift tax.- DGT looks at how income generated by a website is taxed
Legislation
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Spanish tax agency to access database of General Council of Notaries
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Transposed directives on quick fixes (VAT), dispute resolution, distribution of insurance, and occupational pension funds
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Brexit UK’s withdrawal from the European Union takes effect
Miscellaneous
- EU updates tax haven blacklist
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Digital services tax and financial transactions tax bills laid before parliament
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Directorate General for Taxes determines rules for treating certain types of entities created abroad as pass-through entities
- Tax agency’s 2020-2023 Strategic Plan published
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AEAT publishes information notice with its position on insolvency processes
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