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Practical Handbook for Companies 2021

Other obligations of permanent establishments

Regulation: Articles 10, 22 and 23 TRLIRNR

Permanent establishments have the following obligations:

  • To keep its separate accounts, and to comply with all other accounting, registration or formal obligations required of resident entities by corporate income tax regulations.

  • They are subject to the same regime of withholdings and instalments as entities resident in Spain, which is explained in chapters 6 and 14 of this Practical Manual.

    In accordance with the above, the instalment payments will be made on the same forms as for other corporate income taxpayers.These forms are also applicable to entities under the income attribution system incorporated abroad with a presence in Spanish territory.These entities must pay by installments under the same terms as payers of Income Tax for Non-Residents with permanent establishment in Spain, by the amount that corresponds to the part of income attributable to members non-residents.

    Permanent establishments are also obliged to make withholding and payment on account on the same terms as an entity resident in Spanish territory.

  • Non-resident income taxpayers who operate through a permanent establishment are obliged to appoint a representative, natural or legal person resident in Spain, to represent them before the tax authorities.The communication to the Tax Administration shall be made within a period of two months from the date of appointment, and shall be made to the Delegation of the State Tax Administration Agency where the tax return for this tax is to be filed, accompanied by the express acceptance of the representative.However, non-resident income taxpayers who operate through a permanent establishment resident in another Member State of the European Union or of the European Economic Area will not be obliged to appoint a representative, provided that in the latter case, there are regulations on mutual assistance in the exchange of tax information and collection.