{"id":31492,"date":"2020-01-15T12:26:16","date_gmt":"2020-01-15T11:26:16","guid":{"rendered":"https:\/\/gesvalt.es\/?p=31492"},"modified":"2020-01-15T12:26:16","modified_gmt":"2020-01-15T11:26:16","slug":"etve-tax-benefits","status":"publish","type":"post","link":"https:\/\/gesvalt.es\/en\/blog\/beneficios-fiscales-etve\/","title":{"rendered":"ETVE tax benefits: who is eligible?"},"content":{"rendered":"<p class=\"wp-block-paragraph\">Like other EU countries, such as the Netherlands, Belgium and Ireland, Spain introduced in 1995 the <strong>special tax regime for entities holding foreign securities or ETVEs<\/strong>, The aim is to encourage the establishment of international companies in Spain and to attract foreign capital.<\/p>\n\n\n\n<div class=\"row\">\n<div class=\"col-md-6 offset-md-3\"><button id=\"toggle-right4\" class=\"btn btn-default3\">I WANT ADVICE<\/button><\/div>\n<\/div>\n&nbsp;\n\n\n\n<h2 class=\"wp-block-heading\">What are ETVEs?<\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">ETVEs are companies resident in Spain that comply with the requirements established in Articles 107 and 108 of the Corporate Income Tax Law and decide to avail themselves of this special tax regime.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">What incentives does it offer?<\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">Its main incentive lies in the exemption of income from investments in foreign entities. In other words, gains arising both from dividends and capital gains generated by the transfer of shares in foreign companies.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Who benefits?<\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">The regime offers this advantage to those companies that have their headquarters in Spain and hold investments abroad.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">When does it apply?<\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">It is applicable from the moment that the AEAT is notified of its acceptance once the requirements established by the system have been met.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">It shall take effect from the tax period ending after the communication.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Who is eligible for the scheme?<\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">The regime is applicable to those companies that meet the requirements described below and notify the AEAT of their application.<\/p>\n\n\n\n<ol class=\"wp-block-list\"><li>The company's corporate purpose is the management and administration of holdings in non-resident entities, including, but not limited to, other objects.<\/li><li>The company must carry out active management, i.e. it must have the material and human resources necessary for the development of its activity. It must have at least one employee, although it may combine these functions with other work in other group companies.<\/li><li>Shares in non-resident companies must be registered and the details of the holders must appear in the Articles of Association (including public limited companies).<\/li><li>The ETVE's shareholding shall be at least 5% or more than EUR 20 million.<\/li><li>Participation must be maintained for a minimum of one year without interruption.<\/li><li>The investees must have a commercial activity and be taxed abroad by a tax similar to Spanish corporate income tax.<\/li><li>The ETVE must be a company resident in Spain, even if it does not have Spanish nationality.<\/li><\/ol>\n\n\n\n<h2 class=\"wp-block-heading\">Which entities are excluded from the regime?<\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">In order to prevent companies covered by the regime from being merely instrumental, it is not applicable to asset-holding companies (not involved in economic activity, or with more than half of their assets made up of securities), Economic Interest Groupings (EIGs) or Temporary Joint Ventures (UTEs).<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">What are the obligations of the ETVE?<\/h2>\n\n\n\n<ol class=\"wp-block-list\"><li>They are required to keep records and prepare financial statements on an annual basis in accordance with Generally Accepted Accounting Principles.<\/li><li>The accounting statements shall disclose the amount of exempt income in the notes to the accounts.<\/li><li>The amounts of taxes paid abroad on such income shall be disclosed in the notes to the consolidated financial statements.<\/li><\/ol>\n\n\n\n<h2 class=\"wp-block-heading\">Is it compatible with the OECD's international tax avoidance practices (BEPS)?<\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">Yes, the regime is in line with the BEPS plan to combat harmful tax practices, as it requires the existence of \u201cvalid economic reasons\u201d in the Spanish holding entity.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Similarly, it passed the scrutiny of the EU Code of Conduct and the OECD's harmful tax practices programme.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Conclusion<\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">These entities are considered to be one of the most tax competitive European holding companies, which makes them a valid and effective instrument for international tax planning, as they can be used in a variety of ways:<\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>It allows access to the network of treaties to avoid double taxation signed by Spain.<\/li><li>Foreign-sourced dividends and capital gains are exempted in these companies.<\/li><li>Dividend payments to the non-resident parent are exempt from withholding tax in Spain, unless the parent is domiciled in a country that does not pay corporate income tax or is resident in a tax haven.<\/li><\/ul>\n\n\n\n<p class=\"wp-block-paragraph\"><strong><em>Gesvalt, in collaboration with the main tax offices, is at your disposal to provide you with financial and tax advice on this figure.<\/em><\/strong><\/p>","protected":false},"excerpt":{"rendered":"<p>Its main incentive lies in the exemption of income from investments in foreign entities. In other words, gains arising both from dividends and capital gains generated by the transfer of shares in foreign companies.<\/p>","protected":false},"author":1,"featured_media":67095,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[51],"tags":[],"class_list":["post-31492","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-consultoria"],"acf":[],"_links":{"self":[{"href":"https:\/\/gesvalt.es\/en\/wp-json\/wp\/v2\/posts\/31492","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/gesvalt.es\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/gesvalt.es\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/gesvalt.es\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/gesvalt.es\/en\/wp-json\/wp\/v2\/comments?post=31492"}],"version-history":[{"count":0,"href":"https:\/\/gesvalt.es\/en\/wp-json\/wp\/v2\/posts\/31492\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/gesvalt.es\/en\/wp-json\/wp\/v2\/media\/67095"}],"wp:attachment":[{"href":"https:\/\/gesvalt.es\/en\/wp-json\/wp\/v2\/media?parent=31492"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/gesvalt.es\/en\/wp-json\/wp\/v2\/categories?post=31492"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/gesvalt.es\/en\/wp-json\/wp\/v2\/tags?post=31492"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}