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V1088-14 14 April 2014 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · renta mundial

Russian company dividends taxed in Spain on worldwide income and may require submission of Model 720

A person becoming a Spanish tax resident asks about the taxation of dividends from a Russian company. The DGT responds that such dividends are subject to taxation on worldwide income and that reporting obligations for foreign assets must be fulfilled.

The question raised

Taxation of the aforementioned dividends under Personal Income Tax.

The DGT's ruling

Upon acquiring tax residence, the individual must be taxed in Spain on their worldwide income, incorporating dividends into the savings tax base. The Double Taxation Convention with Russia applies, allowing for the deduction of tax paid abroad pursuant to Article 80 of the Personal Income Tax Law (LIRPF). Furthermore, the individual is required to file Form 720 if the value of their foreign shares exceeds the legal thresholds. They must also apply for a Tax Identification Number (NIF) for their financial operations.

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