Spain has integrated Council Directive (EU) 2022/2523 into its tax system through Law 7/2024 of 20 December, according to the Complementary Tax (IC). This measure establishes a minimum taxation of 15% for entities belonging to a large business group. The tax applies to each jurisdiction where these entities operate, effective from the 2024 fiscal year, with the secondary IC becoming applicable from the 2025 fiscal year.
What is the Complementary Tax?
Aligned with OECD standards, the Complimentary Tax targets large corporate groups with net turnover of at least EUR 750 million in at least two of the four preceding fiscal years. The group’s scope is determined based on the domestic and international standards (NIFF). In Spain, the IC is categorized into three types, depending on where the profit is earned:
- Domestic top-up tax
- Primary top-up tax
- Secondary top-up tax
How and when is it applied?
The calculation of the IC will be carried out jurisdiction by jurisdiction. Then, the aggregate figures of the group entities resident in Spain will be considered. Therefore, these data would be the individual results duly adjusted and current tax expense.
The Complementary Tax is complex both in its calculation and in its formal obligations. Therefore, although it will be due in 2026, it will apply to 2024. It is important to analyse its impact in the first months of 2025 in order to prepare the annual accounts.
Tax obligations for companies in Spain are diverse and complex. So, if you need assistance in managing these processes, do not hesitate to contact Auxadi. With over 45 years of experience and presence in more than 50 countries, we support companies in ther international expansion. Moreover, our headquarters are in Spain, providing us with in depth knowledge of the local economy and regulations.
Can Auxadi help?
Auxadi can become your ideal partner. We offer a one stop shop value added outsourcing services in the areas of accounting and reporting, tax compliance, payroll management and representation services, among others.
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Founded in 1979, Auxadi is a family-owned business working for multinational corporations, private equity funds and real estate funds. It’s the leading firm in international accounting, tax compliance and payroll services management connecting Europe and the Americas with the rest of the world, offering services in 50 countries. Its client list includes many of the top 100 PERE companies. Headquartered in Madrid, with offices in US and further 22 international subsidiaries, Auxadi serves 1,500+ SPVs across 50 jurisdictions.
All information contained in this publication is up to date on 2024. This content has been prepared for general guidance on matters of interest only, and does not constitute professional advice. You should not act upon the information contained in this chart without obtaining specific professional advice.No representation or warranty (express or implied) is given as to the accuracy or completeness of the information contained in this content, and, to the extent permitted by law, AUXADI does not accept or assume any liability, responsibility or duty of care for any consequences of you or anyone else acting, or refraining to act, in reliance on the information contained in this chart or for any decision based on it.