Tax Newsletter - October 2019 | Legislation

New protocol amending Spain-U.S. Tax treaty published

On October 23, 2019 the Official State Gazette published the Protocol and its Memorandum of Understanding, amending the Spain-U.S. Treaty.

In our Commentary dated October 28, 2019 we summarized the main contents of this instrument.

Legislation adopted on how to report the residence of pension funds and collective investment vehicles for the purposes of certain exemptions

On October 19 the Official Gazette published Royal Decree 595/2019, of October 18, 2019, amending the Nonresident Income Tax Regulations (Royal Decree 1776/2004, of July 30, 2004), to regulate how pension funds and collective investment vehicles should report their tax residence to claim certain exemptions allowed in that regulation.

You are asked to see our Commentary of October 25, 2019, with a summary of this royal decree.

Canary Islands determines exceptional measures to defer the Canary Islands general indirect tax charges affected by the Thomas Cook case

On October 21 2019 the Official State Gazette published the ORDER of October 17, 2019, establishing exceptional measures to grant a deferral for certain Canary Islands general indirect tax charges not paid by companies in the Thomas Cook group, in certain assessment periods in 2019.

See our Alert for further details.

Mandatory rules implemented on keeping accounting records for products subject to manufacturing excise taxes

On October 5, 2015 the Official State Gazette published Order HAC/998/2019, of September 23, implementing the provisions on keeping accounting records for products subject to manufacturing excise taxes and, where applicable, for the raw materials needed to obtain them.

In particular, it determines the conditions, time periods and procedures relating to keeping those accounting records and supplying them to AEAT.

In the cases of factories, tax warehouses, receipt warehouses, excise warehouses and factories for vinegar, this obligation is to be met on a computerized accounting system at AEAT. In all other cases it may be elected to keep these accounting records on the website, either on numbered paper books, or lastly, on an electronic accounting system.

This Order will take effect on January 1, 2020.

Publication of the annual equivalent rate for the fourth quarter of 2019, for the purpose of characterizing certain financial assets

On September 27, 2019 the Official State Gazette (BOE) published the decision of September 26, 2019, by the Office of the General Secretary for the Treasury and Financial Policy, which, as is now the custom, sets out the reference rates that will apply for the calculation of the annual effective interest rate for the purposes of characterizing certain financial assets for tax purposes, this time for the fourth calendar quarter of 2019. The rates are as follows:

• Financial assets with terms of four years or less: -0.382 percent.
• Assets with terms between four and seven years: -0.265 percent.
• Assets with ten-year terms: 0.169 percent.
• Assets with fifteen-year terms: 0.519 percent.
• Assets with thirty-year terms: 1.023 percent.

In all other cases, the reference rate for the period closest to the period when the issuance is made will be applicable.