New Law in order to reduce financial burden. (Real Decreto-ley 1/2015, de 27 de febrero, de mecanismo de segunda oportunidad, reducción de carga financiera y otras medidas de orden social)

   The financial crisis that so many citizens are still suffering has implied a worrying level of debt in Spain, being for them so difficult to face it. The Spanish Government thought it was required to approve by law a Second Chance “Real Decreto- ley”.
In broad strokes, the new Law has been adopted in order to put a corporation, legal entity, and an individual insolvency proceeding on the same level. So, either an employee or a freelance who is facing a debt situation, as long as they are acting  in good faith, will be able to settle the debt using their estate, patrimony, within 5 years.

   This new legislation has been created with the idea of making easier to find an alternative dispute resolution so as to reorganize the outstanding debts and pay them off. Nevertheless, it was a mistery wether if mortgages would be included or not, finally they  have been subjected too.

On the other hand, this “Real Decreto” will not be applied to unpaid taxes which should have been satisfied to the Tax office and the Social Security.

Fiscal Amnesty Inquiries are being investigated for suspected crime of Money Laundering

 In 2012 the Spanish Government surprisingly decided to introduce measures in order to apply a fiscal amnesty and collect taxes from fraud for an amount of 2.500 million of euros. People complaint about it because they had the impression it was an unfair measure.

 Finally, the Spanish Government collected a higher amount of money, around 12.000 billion euros. Nowadays, probably most of the reliable taxpayers must be happy about the fact that the Spanish Tax agency has opened around 357 investigation files and has sent them to SEPLAC in order to find out where money comes from and investigate if the owners of the money could have committed money laundering.
As far as I am concerned, the fiscal amnesty seemed to be a “trap” to these ones who did not pay taxes when they had to and also obtained money from illegal sources, even for funding terrorists.

This measure was a success when it comes to collect taxes but at the same time, it appears to be a failure because it created an atmosphere of distrust, and as a result in the short-term can be effective but not in the long-term to eradicate Money laundering and Tax evasion.

Personal Income Tax in Spain

Corporate Income Tax in Spain


First Spanish Hospitality Reit

   The First REIT specialized in the Hospitality Sector was recently created in Spain as a result of an alliance between Hispania and Barceló, being the last one the major shareholder of the new SOCIMI. This new Socimi called Bay Hotels & Leisure will have Hotels and Shooping Centres around the Spanish Coast.
   As a matter of fact, this new Spanish Reint means a new way to invest in the Real Estate sector. SOCIMI are listed companies whose corporate purpose is either the holding of shares in the capital of their Socimis or the holding of leased urban assets by means of acquisition and developmen.  One of the main advantages is that there is a tax profit because they are subject to zero taxation under Corporate Income Tax and those shoreholders owning at least 5% of the SOCIMI and are taxed on the dividends received at a minum rate of 10%, will be taxed at a rate of 19% on the portion of the distributed dividends.
Furtheremore, in order for a company to qualify as a Socimi, there is a compulsory distribution of dividends as a Socimi is a listed company and at least 80% of their assets must be land for development  of leasable urban properties, shares of other Real Estate Investment Trusts, SOCIMIS or leasable urban properties. In addition, Socimi are a great way to invest in Spain, given the current environmnet of low yields in the markets and the strong devaluation of properties in Spain.