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Non-Resident Taxation Manual (January 2023)

Residence of legal persons

Internal regulations

Regulations:Article 6 of Non-Resident Income Tax Law

An organisation is considered to be resident in Spain when it complies with any of the following criteria:

  • It was incorporated according to Spanish Law.

  • It has its registered address in Spanish territory.

  • Its effective head office is in Spanish territory.An organisation is considered to have its effective head office in Spanish territory when the management and control of the sum of its activities is exercised from the territory.

In the case of a change of address, the tax period will end when this change has taken place.

The tax administration may presume that an entity located in a country or territory with zero taxation, or qualified as a tax haven (with effect from 11 July 2021, references made to tax havens or countries or territories with zero or low taxation are understood to be made to the definition of a non-cooperative jurisdiction.The Taxation Administration considers an organisation based in a tax-free country or territory as resident in Spain when its main assets, directly or indirectly, consist of assets located or rights that are fulfilled or exercised in Spain, or when its main activity is carried out therein, unless it accredits that its direction and effective management take place in that country or territory, and that its incorporation and operations have a valid economic motivation and substantive business reasons other than the simple management of securities or other assets.

Agreements and double residence

If there is an agreement, when an organisation is considered to be resident in both States, the agreements establish in general that it will be considered as resident only in the State where its effective headquarters is located.

Accreditation of tax residency

A legal organisation proves its tax residence in a specific country by means of a certificate issued by the Tax Authority.The period of validity of these certificates is one year.The certificate shall be valid indefinitely if the entity subject to tax is a foreign country, one of its political or administrative subdivisions or its local entities.