Analisis of the TEAC resolution of July 17, 2020, where it is once again initiated the debate on the deductibility of the remuneration of executive administrators, and its correlation with the “Relationship Principle” or “Teoría del Vínculo” in the mercantile sphere. This is an issue that had already been clarified with the new tax law and the binding doctrine of the DGT.
In the always tumultuous fiscal scene, the summer has brought three important administrative and judicial resolutions with contrary to taxpayers interests, perhaps representative of a future trend in need of reconsideration. Meanwhile, there are still unknowns about possible immediate changes in tax regulations, including taxation of assets.
The months of June and July are usually used by drivers to prepare their vehicles for summer journeys. July is the Corporate Tax´s month, as the vast majority of companies file their returns in this month. This month of July has seen a major ruling by the Constitutional Court, which may have more consequences than those initially derived from the declaration of unconstitutionality it contains. For all these reasons, and in the same way that we are paying attention to our car, I believe that the time has come to stop and carry out a small review of the state of our Corporation Tax. Let's take step by step.
In the last years, the tax authorities have focused on checking the sale of non-traded securities, often ignoring the existence of proof guidelines and relying instead on one of two objective methods.
We have been homebound due to the declaration of the state of alarm since March 14th, which entails restrictions on the rights and guarantees laid down in the, mainly with regard the freedom of movement.
This situation is duly proportionate to the significant public health risks that have resulted from the COVID-19 pandemic. And, for this reason, it has been assumed with calm and resignation by the citizens, who are setting an example of solidarity and civility.
We are currently suffering from a historical health crisis with very important economic repercussions. On Friday the Governor of the Bank of Spain referred to this situation as an "unprecedented disturbance". It is therefore necessary and pressing to adopt public policies that, initially, mitigate the impact, and later allow the economy to be restarted as soon as possible.
Among the strategies used by the Administration to improve citizens' tax compliance is the annual publication of the identification data of taxpayers who owe more than one million euros to the Treasury, whether in tax payments, interest on late payments or penalties.
Rural savings banks and credit unions have a special tax regime in Spain, mainly regulated by Law 20/1990, of December 19, on the Tax Regime of Cooperatives. This rule explicitly establishes in its article 33 that as protected cooperatives they are, and in spite of being these the lenders of a credit are exempt from paying the mortgage registration tax, whose duty falls exclusively on the client.
In this sense, the last modification introduced in the consolidated text of the Law on Tax on Patrimonial Transmissions and Documented Legal Acts (TRITP-AJD), approved by Royal Legislative Decree 1/1993, of September 24, in relation to the application of the tax benefits and exemptions granted by the TRITP-AJD or other laws in the Tax on Documented Legal Acts, raises questions about whether the provisions of article 33 of Law 20/1990 is an express provision for the purpose of maintaining the Exemption in the constitution and cancellation of mortgage loans granted by rural savings banks and credit unions.
A few days before the end of 2019, it is convenient to review certain practical accounting and tax issues that can help us to better plan the coming year, and even save us money in taxation. Therefore, we give some advices to take into account before this year’s end.
The judgment of the National Court of last July is in comments, in which, through the indiciary test, the application of the exemption in the Personal Income Tax of a compensation for severance payments agreed in an act of conciliation before the labor authorities is denied . The Tax Authorities and the aforementioned Court presume the existence of an agreement between the parties.
The Supreme Court must resolve two new issues related to the Tax on increase in urban land value: first, whether it is possible to determine the taxable base according to the accounting result declared in the Corporation Tax; and, secondly, whether it is possible to update the acquisition value of the property according to the CPI or to some inflation correction mechanism.
For years, the assignment of subsidiary liability to company managers was a relatively rare procedure, associated with cases of serious omissions of settlements and / or tax payments. However, for various reasons, this assignment of liability has become an increasingly common procedure in recent years, which has revealed several shortcomings in its regulation and implementation, which should be corrected as soon as possible to ensure equity, and proportionality in the procedures related to the collection action.
In recent years there has been an intense debate on the fiscal regime applicable to Spanish SICAV. The measures contained in the recently published Draft Law on General State Budgets for 2019 have important consequences on these entities, which must be analyzed by their shareholders in order to seek alternatives for action.
The fact of introducing an anonymous author in certain way is often used in narrative. But in this case I was highly inspired by the announcement of a minimum tax for corporations, due to such low effective rate observed in these entities in recent times, particularly in big corporations. As this note is inspired by traditional fables and parables, its aim is no other than giving a value judgment, meaning that it might not be shared neither agreed by all readers.
The conflict between development and redistribution is in the focus of the debates on the most appropriate economic policy. Quite often, the arguments in favor of the preeminence of one over the other are not so rooted in the analysis of the economic and social impact of the suggested measures, as on their popularity for the electors, with an increasing trend towards social duality. This social duality distorts the principle inspiring the creation of the modern state of law: charges must be approved by those on which such charges will be levied. This post poses three illustrative examples of such a situation.
After two long years of proceedings against the Madrid City Council, the Contentious Administrative Court of Madrid has finally ruled in my favour: the controllers of the Municipal Regulated Parking Service (known by its acronym SER) are required to incorporate in the administrative file when signing a fine an image of the vehicle, in the form of photography, digital filming or other technological means, that allows them to endorse the complaint made. Not meeting this legal requirement, the fine would be illegal.
Much has been discussed lately about the legality or lack thereof of exercising economic activity through a company as opposed to channeling the same sort of activities through a partner of the latter, as well as the changes made in the Tax Authorities’ criteria. Nevertheless, this is not an issue that is new or that has undergone significant modifications in the recent past years, it is simply a litigious issue that has not yet been resolved.
The latest shock for our profession and clients arises from a sentence of the Supreme Court dated February 26, 2018, regarding the compliance in determining the executive directors' salary conditions.
Few matters in Spanish companies' law have been subject to so many diverse interpretations and contradictory court decisions as that one related with the regime of administrators' remuneration. The Supreme Court has given a ruling on Directors´ remuneration that implies a radical change in the way in which the applicable law needs to be interpreted.
The stormy progress of the takeover bid of ABERTIS and the hotness and coldness of its participants recall those romantic novels in which an outcome with tragic tinges different to those desired by its leading characters end up imposing themselves. The leading figures of these works cannot be removed from the force of destiny because, although they do not know it, the final outcome has already been written.
New doctrine of the Directorate General for Registers and Notaries that states that the power of the Board of Directors to appoint Directors expires or not depending on the agenda of the previous Boards of Directors.
Articles of Association of a limited liability company may include provisions by which the first refusal right can be exercised at book value and not at the market value of the shares.
Practical criteria on the formalities that must be used in signing public deeds in which a signatory appears represented a third party using a power of attorney.