Who is obliged to withhold Corporation Tax?
Article 41 of Law 27/2014, of November 27, on Corporate Tax (LIS), simply states that withholdings on account will be deductible from the full tax.
In accordance with article 128 LIS, entities, including communities of property and owners, that pay or pay income subject to Corporate Tax will be obliged to withhold or make deposits on account, as payment on account, the amount that results from applying the withholding percentages indicated below to the withholding base, and depositing its amount into the Treasury in the cases and forms established.
Natural persons will also be obliged to withhold and pay income with respect to the income they pay or pay in the exercise of their economic activities, as well as natural persons, legal entities and other entities not resident in Spanish territory that operate there through a permanent establishment.
Likewise, insurance entities domiciled in another Member State of the European Economic Area that operate in Spain under the regime of free provision of services, in relation to operations carried out in Spain, will be required to make withholding or deposit on account.
The subject obliged to withhold must present within the deadlines, form and places established a declaration of the amounts withheld or a negative declaration when the practice of these has not occurred. Likewise, it will present an annual summary of withholdings. The corresponding declaration models will be approved by the Minister of Finance.