Operating in the Spanish market as a foreign company can open great business opportunities, but it also comes with a series of tax obligations that must not be overlooked. Proper understanding and compliance with these responsibilities not only prevent legal issues but also ensure efficient operations in the country.

Below, we break down the main tax obligations that every non-resident company with a Tax Identification Number (hereinafter, NIF) in Spain must comply with to avoid complications. It is essential to understand the applicable taxes, the required formalities, and the associated legal implications.

 

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Non-Resident Income Tax

A non-resident company with a NIF in Spain is a legal entity established outside Spanish territory that conducts economic activities or generates income in Spain. The main tax they must comply with is the Non-Resident Income Tax (hereinafter, IRNR), regulated by Royal Decree 5/2004, of March 5, which is divided into two main categories. The tax regime depends on whether or not there is a permanent establishment in Spain. A permanent establishment refers to facilities or workplaces where all or part of the activity is carried out. Examples include a branch or an office.

Income obtained without a permanent establishment

When a non-resident company earns income in Spain without a permanent establishment, its earnings are considered non-resident income and are taxed under IRNR. Some examples of this type of income include:

  • Rental income from real estate: Renting properties in Spain as a foreign company requires taxation on the generated rental income.
  • Dividends and other financial income: When a non-resident company receives dividends, interest, or other financial income from investments in Spain.
  • Services provided from abroad: If a non-resident company provides services in Spain, whether occasionally or continuously, it is also subject to IRNR.

Income obtained with a permanent establishment

If the non-resident company conducts economic activities in Spain through a permanent establishment, the income obtained is taxed differently. The company is subject to IRNR but has similar obligations to a resident company, including filing the Corporate Income Tax.

 

VAT for businesses established outside Spain

Non-resident companies conducting VAT-liable operations in Spain, such as intra-community transactions, must register for this tax, collect it on their sales, and file returns with the Spanish Tax Agency. Additionally, depending on the volume of transactions, VAT returns may be filed monthly or quarterly, using the forms established by the Tax Agency. These include Form 303 for periodic declarations and Form 390 for the annual declaration.

 

Obligation to appoint a representative

Non-resident companies operating in Spain may be required to appoint a tax representative residing in Spain, especially if they operate through a permanent establishment. Article 10 of the IRNR Law states that companies not residing in another European Union member state must appoint, before the deadline for filing the income obtained in Spain, a person or company residing in Spain to represent them before the Tax Administration.

Article 9 of the same regulation also defines the figure of the jointly liable party. This refers to a person who assumes responsibility for the tax debts of a non-resident company or entity in Spain.

 

✅​ Want to learn more about the taxation manual for non-resident companies?

For non-resident companies with a NIF in Spain, meeting tax obligations is essential to operate smoothly. This requires a detailed understanding of, among other things, the Non-Resident Income Tax, VAT specifics, and the obligation to appoint a tax representative in certain cases.

At Adlanter, we provide a comprehensive and personalized approach to understanding the taxation of your non-resident company in Spain. With an expert team and advanced tools, we help businesses navigate these processes safely and efficiently, ensuring regulatory compliance and protecting their interests. Additionally, understanding the implications of having or not having a permanent establishment in the country is crucial.

📞 Contact us to speak with our professionals and discover how we can help you meet your tax obligations as a non-resident company with a Tax Identification Number in Spain.

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