Foreign individuals who become Spanish residents are subject to Spanish Personal Income Tax (PIT) on a worldwide basis. A survey of income tax, social security tax rates and tax legislation shows the impact on expatriate employees working in Spain (taxation of international executives).
Foreign individuals who become Spanish residents are subject to Spanish Personal Income Tax (PIT) on a worldwide basis. Non-residents will be subject to PIT, but only on income arising and capital gains obtained from Spanish sources.
A special tax regime for inbound assignees might be available for those individuals who become Spanish tax residents as a consequence of their assignment to Spain or of acquiring a director position in an entity, provided certain requirements are met.
An individual may be taxed as part of a family unit, usually consisting of two spouses and children under the age of 18 (except those living independently with parental consent).
The members of a family unit may choose to file separate tax returns. If one member of the family unit chooses to file a separate return, then the other members of the family unit must also file separately.
The tax year for an individual is the calendar year, unless the taxpayer dies on a day other than 31 December.
The official currency of Spain is the Euro (EUR).
Herein, the host country refers to the country to which the employee is assigned. The home country refers to the country where the assignee lives when he/she is not on assignment.
Specific Personal Income Tax regulations and scales of rates apply in the territories of the Basque Country (Vizcaya, Guipuzcoa and Alava) and Navarra, and advice on the specific tax treatment applicable therein should be seeked for assignments to/from them.