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V2370-14 10 September 2014 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · residencia fiscal

Fiscal residence and taxation of geological services in Algeria depend on the existence of a permanent establishment

A Spanish geologist working in Algeria for a Dutch company asks whether he should tax in Spain or Algeria. The DGT examines his fiscal residence and the application of the Double Taxation Agreement to determine the tax jurisdiction for his income.

The question raised

Whether taxation should occur in Spain or in Algeria.

The DGT's ruling

If the consultant is a tax resident in Spain, their income shall be taxed in Spain on the basis of their worldwide income. If they carry out their activity in Algeria through a permanent establishment, Algeria may tax the portion of the income attributable to said establishment. If no permanent establishment exists in Algeria, the income shall be taxed exclusively in Spain. Regarding VAT, geologist services for hydrocarbon extraction are not subject to tax in Spanish territory.

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