Skip to content
Back to index
V2261-14 3 September 2014 · SG de Impuestos sobre las Personas Jurídicas Criterion in force
IS · establecimiento permanente

Foreign consultancy fees taxed under corporate income tax; VAT location depends on service nature and recipient

A company provides consultancy services to a public body in the Maldives. The tax authority determines that the income is subject to Spanish Corporate Income Tax and assesses VAT applicability based on service characteristics and recipient.

The question raised

Taxation under Corporate Income Tax and Value Added Tax in Spain.

The DGT's ruling

In Corporate Income Tax, the entity must include in its tax base the income generated by services without a permanent establishment in the Maldives. Regarding VAT, consulting services shall not be subject to tax if the recipient is not a business person and resides outside the Community, or if they are a business person with headquarters abroad. However, taxability cannot be determined if the services are related to real estate outside Spain without knowing the intensity of their connection.

Book your free first meeting