If you are liable for tax in two countries, the treaty prevents you from paying tax twice. We apply it correctly.
If you live or work in two countries, the same income will likely be subject to tax in both. Double taxation agreements are in place to prevent this. We determine which one applies to your situation and handle it correctly.
International companies setting up in Spain without specialist support often encounter the same difficulties:
Spain has signed double taxation agreements with more than 90 countries. Most of these follow the OECD Model, but each agreement has its own specific features. Applying the wrong agreement or ignoring its limitations comes at a real cost.
Determining residence status
We analyse your personal circumstances to determine in which country you are a tax resident and what implications this has for each source of income you generate.
Implementation of the relevant agreement
We identify the applicable double taxation agreement, interpret its provisions in line with your type of income, and correctly apply the method for eliminating double taxation.
Statutory reduction in the tax burden
We optimise tax arrangements within the current legal framework: exemptions, tax credits and revenue structures that are compatible with the relevant treaties.
Management of international withholding tax
We check whether the deductions made comply with the limits set out in the CDI and, where appropriate, arrange for their refund from the relevant tax authority.
Conducting business between two countries without proper tax planning can mean paying tax twice on the same income. When the treaty is applied correctly, it is a structured process that removes that burden entirely within the law.
We determine your tax residence, identify the applicable Double Taxation Agreement (DTA) and manage all types of income – wages, dividends, pensions and royalties – so that you pay tax only where you should and not a single euro more.
Spain has double taxation agreements in force with more than 90 countries. We are familiar with their provisions and know how to apply them.
Does Spain have a bilateral agreement with my country of origin?
Spain has double taxation agreements in force with more than 90 countries, including all EU Member States, the US, the UK, Japan, China, Mexico, Argentina and many others. If no such agreement exists, Spanish domestic tax legislation applies unilaterally, which may result in a higher tax burden. We check this during the initial consultation.
What does it mean for a CDI to follow the OECD Model?
Most of the treaties signed by Spain are based on the OECD Model, which establishes a common framework for the allocation of taxing rights between states. This facilitates interpretation, although each treaty may contain significant variations that need to be analysed separately.
What methods are available to eliminate double taxation?
The two main methods are exemption (the income is taxed in only one country, whilst the other grants an exemption) and tax credit (the income is taxed in both countries, but the second country allows a deduction for the tax paid in the first). The method applied depends on the treaty and the type of income.
What is the mutual agreement procedure (MAP)?
The MAP (Mutual Agreement Procedure) is the mechanism provided for in Double Taxation Agreements (DTAs) to resolve disputes over interpretation between two tax authorities. If both countries claim the same tax and no direct agreement can be reached, the MAP allows the competent authorities to negotiate a solution. It is a technical and lengthy process; we manage it from start to finish.
Let’s talk about how we can work together and achieve success. Click the contact button to get started now!
GR International Advisors SL
Tax Consulting in Barcelona
Phone: 643 90 96 04