Spain - Other taxes and levies

Spain - Other taxes and levies

Taxation of international executives

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Social security tax

Are there social security/social insurance taxes in Spain? If so, what are the rates for employers and employees?

Employer and employee

Type of insurance Paid by employer Paid by employee Total
Social security 29.90%* 6.35%** 36.25%
Total 29.90% 6.35% 36.25%

* Plus a percentage to cover labor accidents and illnesses.

** For indefinite contracts.

In principle, all employees working in Spain, regardless of their nationality, must be registered with the Spanish social security system and the employer must make the corresponding contribution for both employer and employee. These contributions depend on the category of each employee and cannot exceed certain limits.

Employer rate (plus a professional contingency rate depending on the company activities) is 29.9 percent plus a percentage to cover labor accidents and illness (percentage depends on the activities) and employee rate (indefinite contracts) is 6.35 percent.

Both Spanish and foreign social security contributions can be deducted from the compensation income, as long as they are directly related to work income subject to Spanish PIT and are compulsory.

The minimum and maximum social security bases vary depending on an employee’s category of employment and educational background. Please note that expatriates, according to international social security agreements and EU applicable regulations, may keep home-country social security contributions and regimes.

The current maximum monthly Social Security base is EUR 3,642. Any income exceeding that maximum base is not subject to both employee and employer contributions.

Gift, estate, wealth and/or inheritance tax

Are there any gift, wealth, estate, and/or inheritance taxes in Spain?

Gift and inheritance tax

This tax is levied if one or more of the three events listed occur.

  • The acquisition of any type of goods, or rights, through an inheritance or legacy.
  • The acquisition by an individual of goods or rights as a gift or donation.
  • The amounts received by the beneficiaries of life insurance contracts when the contracting party is a different individual than the beneficiary.

The taxable base is normally the net value of the goods and rights in question.

The tax rates depend on the amount involved, the degree of family relationship between the donor and the donee and the previous net worth of the donee.

In certain regions such as Madrid, there are reductions available of up to 99 percent under certain conditions.

Wealth Tax

The Spanish Government has reinstated Net Wealth Tax.

The general deduction is EUR 700.000. There is an additional exemption for the taxpayer’s habitual residence up to an amount of EUR 300.000.

The general deduction is also applicable to non-residents in Spain, who are taxed only on Spanish net wealth.

Autonomous Communities can modify these amounts, establish additional exemptions and change the rates. In certain regions such as Madrid, there are reductions available of up to 100 percent of the tax due for residents in Spain.

The tax rates are applied in accordance with a progressive scale that varies from between 0.2 percent and 3.03 percent. The total combined amounts due for Net Wealth Tax and PIT cannot exceed 60 percent of the PIT taxable base.

Real estate tax

Are there real estate taxes in Spain?

There is a local tax levied on Spanish property charged annually by the municipality where the property is registered.
The amount of the tax is calculated by reference to the cadastral value.

Sales/VAT tax

Are there sales and/or value-added taxes in Spain?

There are two main indirect taxes in Spain that could tax sales operations carried out within the Spanish Territory depending on the status of the individual/entity which performs said operations, as follows:

  • Spanish Value-Added Tax (IVA): companies/entrepreneurs/professionals
  • Spanish Transfer Tax (ITP-TPO): individuals

Unemployment tax

Are there unemployment taxes in Spain?

The amounts received under unemployment systems are considered as work income.

Other taxes

Are there additional taxes1 in Spain that may be relevant to the general assignee? For example, customs tax, excise tax, stamp tax, and so on.

Information is not available.

Footnote

1All additional tax information in this section is summarized by KPMG Abogados, S.L., the Spanish member firm of KPMG International, based on the Social Security (SS) General Law dated 20 June 1994, Royal Decree 2064/1995 dated 22 December 1995 that elaborated SS General Law; Royal Decree-Law 13/2011 dated 16 September 2011 that reinstates Net Wealth Tax; Inheritance and Gift (IG) Law dated 18 December 1987 and Royal Decree 1629/1991 that elaborated IG Law. 

© 2016 KPMG Abogados, S.L., a Spain legal liability company and a member firm of the KPMG network of independent member firms affiliated with KPMG International, a Swiss cooperative. All rights reserved.

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