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Austria-Spain Double Tax Treaty

Austria-Spain Double Tax Treaty

Spain and Austria signed a treaty for the avoidance of double taxation in December 1966. The treaty is applicable to natural persons and legal entities, tax residents of both countries and it is enforced when the tax residents of a state are performing taxable activities in the other contracting state. Austrian tax residents who are interested in opening a company in Spain can benefit from the effects of the double taxation agreement (DTA), which offers various tax exemptions or deductions. The treaty provides a comprehensive image on the taxes which are applicable under the agreement and our team of company formation agents in Spain can offer advice on the manner in which such taxes are imposed. 

Taxes under the Austria – Spain DTA   

According to the stipulations of the treaty, a set of taxes are applicable to the tax residents of the two states. 

Article 2 of the Convention stipulates that Austria will apply the following taxes

  • the income tax on individuals;
  • corporate income tax;
  • contribution for rents for the promotion of households and the compensation for family responsibilities;
  • tax on administrators;
  • tax on industrial and commercial exploitations, including the tax on wages;
  • tax on heritage;
  • the land tax;
  • the tax on agricultural and forestry exploitation;
  • the tax on the value of vacant lots;
  • the tax on property not subjected to the tax on inheritance. 

Austrian investors who are interested in company formation in Spain should know that the Spanish authorities will impose, amongst many other taxes, the following: 

  • the general tax on the income on rents obtained by natural persons;
  • the general tax on the income on rents obtained by companies and other legal entities.

Our team of company formation consultants in Spain can offer an in-depth presentation on the other taxes applied by the local authorities. 

Permanent establishment in Spain  

According to the stipulations of Article 5, a permanent establishment in Spain is considered to be a fixed place in which the company carries out its commercial activities. Such companies can carry through the permanent establishments all their commercial activities or a part of their objects of activity. Foreign investors interested in company registration in Spain should know that a permanent establishment designates an office, a branch office, building sites in which the operations are carried out on a continuous basis for at least twelve months, as well as mines and other types of establishments

We invite businessmen to contact our company formation representatives in Spain for more details on the stipulations of the treaty