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ImpuestosAlthough the income tax campaign is still in its last throes, at Vasalto we are already thinking about what is to come. Next July is the deadline to pay the Inheritance Tax. Therefore, we wanted to dedicate a series of articles in our blog to better explain this tax. Next we are going to detail the most basic and important aspects of the IS: its characteristics, who has to pay it, how it is calculated and which are the models for its presentation.
Corporate income tax is the tax levied on the income of companies and other legal entities located in Spain. To better understand the nature of the tax, it is best to look at its characteristics. We will classify it as a personal, direct and periodic tax.
It is personal because it takes into account personal circumstances. The taxable event, which is what is taxed, is the income obtained by legal entities, mainly commercial companies. There are also other types of taxes that are not related to these personal circumstances. An example of a real tax is the Real Estate Tax (IBI).
It is a direct tax because it is levied on the wealth itself. In this same classification we can find taxes such as Personal Income Tax (IRPF), which is levied on the acquisition of wealth by an individual. Other taxes such as VAT (Value Added Tax) tax the use of this wealth.
Finally, it is periodic because it is a tax liability that is generated over time. As the taxable event is prolonged in time, this tax is settled after the end of this period. The tax period for this tax is the fiscal year. This means that this year is taxed on the income obtained in the year 2023. On the other side we find the instantaneous taxes. These place their taxable event in specific acts. The Inheritance and Gift Tax can be an example of an instantaneous tax. Inheriting or donating are concrete acts, they are not prolonged in time, that is why their liquidation is instantaneous.
A taxpayer is any person, whether an individual or a legal entity, who is obliged to file a tax return. In the specific case of Corporate Income Tax, taxpayers will always be legal entities. In Spain there are many types of legal entities, but those that are liable for this tax are the following:
These companies are obliged to file the tax, even though no income has been obtained during the year. Nor does it exempt from filing in situations such as bankruptcy or liquidation of the company.
The first thing we have to know when calculating the Corporate Income Tax is the tax rate that corresponds to each company. There are six different percentages, which are going to be applied according to a series of circumstances:
Once the corresponding tax rate is known, it is time to calculate the tax. Now we have to know the accounting result, which is nothing more than the result of subtracting the expenses from the income of a company.
A series of reductions can be applied to this accounting result to obtain the taxable base. These reductions, such as the offsetting of tax losses, are specified in Chapter V of the Corporate Income Tax Law (LIS).
Once the relevant reductions have been made, the gross tax liability is calculated by applying the tax rate.
The most important forms relating to Corporate Income Tax are as follows:
At Vasalto, we have been helping companies with a comprehensive service for more than 30 years. We offer both payroll outsourcing services and accounting advice. During these years we have worked hand in hand with a large number of clients who are leaders in their respective sectors, which gives us a great deal of experience in the sector.
We are present in several countries, with headquarters in Madrid, Barcelona, Porto and Bordeaux, and we have clients all over the world, as well as collaborators in more than fifty countries. Moreover, Vasalto is a purely technological company. We believe in putting technology at the service of talent. That is why we have a series of proprietary computer systems that allow us to manage more than 35,000 payrolls every month and automate most of our clients’ accounting procedures.
Thanks to Valanza, Vasalto’s legal firm, we also have a team of lawyers specialized in the areas of commercial, civil, labor and administrative law, among others. We count on them to provide the best legal assistance possible, always working towards comprehensive service.
If you are interested in learning more about payroll outsourcing, at Vasalto we will be happy to assist you. Contact us to get to know us and see how we can help your company.