Amendment of the Personal Income Tax Regulations and of the Nonresident Income Tax Regulations

On June 11th, 2015, the Official State Gazette published Royal Decree 633/2015, of July 11th, 2015, amending the Personal Income Tax Regulations and the Nonresident Income Tax Regulations. These amendments are related to exemptions, earned income, business activities and withholding taxes, among others. With respect to Nonresident Income Tax amendments, the Royal Decree modifies matters relating to the taxable base on withholding taxes or the application of the tax refund on capital gains’ which come from the reinvestment on habitual residence, among others.

New Corporate Income Tax regulations

With the effective date of the Royal Decree 634/2015 of July 11th, 2015, the new Regulations for Corporation Tax have been approved. This Regulation modifies legislation in terms of patrimonial entities, tax base, related operations, tax deductions, etc.

New tax rates and withholding tax rates for 2015

On June 11, 2015, the Official State Gazette published the Royal Decree-Law 9/2015, of July 10th, 2015, of urgent measures to reduce the tax quota on Personal Income Tax and other economic measures.

Some of the measures are:

►► Tax reduction on grants received by groups of people with risk to be socially excluded and people in emergency situations.
►► Tax rates reduction on Personal Income Tax (between 0.5% and 1%) and withholding taxes (from 19% to 15%) on incomes obtained between July 12th and December 31st, 2015.
►► Standard withholding tax rate reduction of Corporate Income Tax (from 20% to 19.5%)