Ltd in UK, living in Belgium, first contract in Spain :)

[ASB]

I just had a quick look. Spain operates a withholding tax regime. 24.75% of the gross invoice value should be withheld.

this isnt required if the uk tax man will provide a certificate of tax residency. These are not always easy to obtain.

[SueEllen]

I just had a quick look. Spain operates a withholding tax regime. 24.75% of the gross invoice value should be withheld.

this isnt required if the uk tax man will provide a certificate of tax residency. These are not always easy to obtain.

Won't work for the OP as the UK taxman needs proof that the business is normally based in the UK not just incorporated here.

[BlasterBates]

A company is not like a person with a tax residency, it is expected to have subsiduaries wherever it is doing business. These subsiduaries are then run as independent businesses rather like a multinational.

IBM is a US company, but it is expected to have IBM UK and so on.

In Europe you can do this with one legally incorporated entity but you are still expected to have a separate set of accounts and place of registration for each country you are in.

A German accountant pointed this out to me a long time ago .

[Tiresias]

@tomtomagain : yes i actually questioned that myself. That is something that makes me feel that what i am saying is totally wrong

@blasterbate: ok if this is the case i will likely open a ltd in Spain (it is called SL) then. Hopefuly i can do it while living a bit in belgium ... problem is that after this project i shall work most of time in uk... what a pain to have to tie company to a specific location. Specially nowdays where mobility is key for software engineer.

Still i am confused about the
"The general rule is you pay tax where your business activity is"
=> i thought this applied to the income tax, not corporate?

blaster could you elaborate on the interesting:
"have a separate set of accounts and place of registration for each country you are in" ?
what is an account and a place of registration ?

[ASB]

In Europe you can do this with one legally incorporated entity but you are still expected to have a separate set of accounts and place of registration for each country you are in.

I never bothered over 25 years and most of europe. Didnt have issues save for the one with potugal. But more and more places have withholding taxes.

I doubt I was properly legal though.

[BlasterBates]

@tomtomagain : yes i actually questioned that myself. That is something that makes me feel that what i am saying is totally wrong

@blasterbate: ok if this is the case i will likely open a ltd in Spain (it is called SL) then. Hopefuly i can do it while living a bit in belgium ... problem is that after this project i shall work most of time in uk... what a pain to have to tie company to a specific location. Specially nowdays where mobility is key for software engineer.

Still i am confused about the
"The general rule is you pay tax where your business activity is"
=> i thought this applied to the income tax, not corporate?

blaster could you elaborate on the interesting:
"have a separate set of accounts and place of registration for each country you are in" ?
what is an account and a place of registration ?

In simple terms Spain will want both corporate tax and income tax on your revenue in Spain as you will be working in Spain. Therefore you will need to calculate the profit on your contract in Spain subtracting costs from the revenue (what your agent pays you for your Spanish contract), this is what I mean by a set of accounts. You will need to get a tax registration number from a local Spanish tax office (place of registration) and arrange to pay VAT, corporate tax and income tax.

Probably it will be easier to let a Spanish accountant set things up for you.

When you return to the UK you need to go and see a UK accountant.

I think it will be easier to have a separate company for your Spanish contract.

[DimPrawn]

That's the great thing about the EU. It just makes doing business so easy.

http://euvataction.org/key-facts/

[Confounded]

A company is not like a person with a tax residency, it is expected to have subsiduaries wherever it is doing business. These subsiduaries are then run as independent businesses rather like a multinational.

IBM is a US company, but it is expected to have IBM UK and so on.

Dear BlasterBates,

Are you really saying that a company which operates internationally has to set up another local company in every country where it sends its representatives on an assignment? I am sorry, but this sound absurd. It would be impossible to operate in this way. Do you have a reference / link to a legislation that demands this?

Thank you

[clearedforlanding]

@tomtomagain : yes i actually questioned that myself. That is something that makes me feel that what i am saying is totally wrong

@blasterbate: ok if this is the case i will likely open a ltd in Spain (it is called SL) then. Hopefuly i can do it while living a bit in belgium ... problem is that after this project i shall work most of time in uk... what a pain to have to tie company to a specific location. Specially nowdays where mobility is key for software engineer.

Still i am confused about the
"The general rule is you pay tax where your business activity is"
=> i thought this applied to the income tax, not corporate?

blaster could you elaborate on the interesting:
"have a separate set of accounts and place of registration for each country you are in" ?
what is an account and a place of registration ?

The only benefit I know of an SL in Spain is for those who plan on going on the dole there after the contract. I am non resident English, with a home in Ixelles and contract in Spain frequently. Your business in Spain can run in parallel to your UK Ltd, but I don't see any benefit of using it because you are going to end up as an "Autonomo", there is no compliant way out.

Get a NIE, but don't pick a Residencia because the rules now require you to declare your global income as a resident.

The cost of living in ES compared to BE is so dramatically different that you'll probably not grumble too much about the Autonomo taxes and like everyone else you'll be expensing like a mad hatter anyway.

[AtW]

this isnt required if the uk tax man will provide a certificate of tax residency. These are not always easy to obtain.

Can take a month to obtain, that if you manage to find a handful of people who are allowed to do it.

Spain is using all sort of tricks to keep the money - for example they've got two different VAT numbers: internal for Spain, and those that are external and could be used for VAT free trade within EU, obviously it's done to make it harder for other EU members to sell stuff to Spain. EU should have dealt with this bulltulip long time ago.