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Newsletter No. 26 - March 2012

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Details Newsletter No. 26 - March 2012

  • The Tax deductibility questions on income tax of the remuneration of directorsThe Tax deductibility questions on income tax of the remuneration of directors

    Surprising should qualify the Note published yesterday by AEAT on considerations concerning the tax treatment of business entities partners

    For your interest I refer note drawn up by the Inland Revenue concerning the tax treatment of business entities partners.(View the PDF document)

    This controversial issue erupted in Malaga when the tax was intended to secure the pay VAT which declared member-managers of commercial companies on the basis of amounts reported on Form 190 on the ground that were not economic activities and employment income. Recently from the Taxation Agency of Murcia have started sending requirements surprising that direct the taxpayer receives a proposal for adjustment in the income tax which does not take into consideration the salaries for managers, with more than obvious effect on the tax to enter.

    Pressure from various groups and professional associations of tax advisors, along with the dubious legality of account for VAT on an annual basis and not quarterly (a situation that the courts of the EU and have clear on countless occasions the Spanish State) had the Tax paralyze these proceedings.

    The own tax office, at the request of the professional groups Tax Forum undertook to publish a few parameters to establish the relationship between society and its partner and fiscal impact and avoid legal uncertainty that had been unleashed in the wake of the records of Malaga.

    The answer is this document that we send you. The impression we get is of profound disappointment, as it almost does not explain anything and leaves us like we were in that:

    1 ° This note is limited to the scope of Income Tax of Individuals (income tax), excluding taxes.

    2 ° No matter may be established in some cases criteria delimiters to determine a generic nature for the purposes of income tax of certain income, the existence or not in each case the circumstances which determine that classification is a matter of fact, whose accreditation must be in evidence permitted by law, as provided in Article 106 of Law 58/2003 of December 17 General Tax (BOE of 18 December), corresponding to their judgment for the management and inspection bodies of the Administration tax.

    That is, the Tax Administration does not consider binding criteria seeks to establish in the note, and it then leaves assessment of inspection bodies the nature of the performance established between the partner and society.

    3 º The total remuneration received by the exercise of the duties of the position of director, whatever that is formalized in addition to the charge of a labor contract of top management, must be understood understood, for the purposes of income tax of individuals in employment income referred to in point e) of paragraph 2 of Article 17 of the LIRPF.

    4 ° And finally, regarding the most common case of socio-administrator a salary for providing a job to the society (and free as a director) is guilty of an administration desperate ambiguity by providing that:

    From a tax perspective, it is essential to analyze in each case the presence or absence of the notes in dependence and alienation and, whether or not media based production partner, so that such facilities exist based production partner only in the absence of such notes will fit partners understand that they operate the entity ordering the factors of production on their own within the meaning of Article 27 of the LIRPF and therefore are economically active. By contrast, the rating will yield the same work when there are those letters of dependency and alienation, or if no such means of production.

    Clearly, the existence of such notes and means of production is a matter of fact, their judgment for the corresponding organs of management and inspection of the Tax Administration and may be accredited by the taxpayer through evidence permitted by law.

    Of course, clear that when one partner has more than 50% of the company, it is presumed that there is no strangeness and should be noted that in the case of professional services (law??, consulting, architectural services, medicine ...) the main means of production lies in the partner itself, ie, in-house professional training of the individual who provides services-are services whose contract has a distinctly "intuitu personae", so that the material means necessary for the performance of services provided by the institution are of little relevance in the human factor.

    From all this we conclude that the member-managers who own more than 50% of the company and providing professional services, the Administration will consider them, to prosper the criteria established in this note, which engaged in economic activities and can not be paid as earned income.

    In short, the Administration does not clarify anything already known or intuited, deepening, if possible even in the harsh legal uncertainty.

    As a first step would be advisable to warn of what the criteria established by the Inland Revenue in this paper and detailed analysis on a case by case whether to change the rules of the game between the partner and the company and offering several alternatives so they can decide:

    a) Remuneration as a director by statute.

    b) Declare the income received as income from economic activities (with the corresponding high, VAT returns, bookkeeping required, etc.).,

    c) Maintaining employment income.

    Given the severity, extent and possible effects of these measures can bring, we suggest that you put as soon as possible contact your account manager or office.

    Source: AuthorsBack Top

  • Optional Modification Quotes Base in the Special Scheme for Self-EmployedOptional Modification Quotes Base in the Special Scheme for Self-Employed

    We remind you that prior to May 1 have the option to change the base price of the Special Scheme for Self-employed within the limits permitted by law

    if are interested to modify the above or fee basis (in order to broaden the base for calculating retirement or temporary disability low), please let us know and as far in advance as possible.

    We enclose, by way of example, comparative scale with some options (amounts in force in 2012):

    * 29.90% = 29.80% + 0.1% (for self-employed without protection for eventualities arising from accidents, occupational diseases and cessation of activity)

    Also, please note that self-employed workers, to January 1, 2012, have47 years old and listed RETA on a base of less than € 1,682.70 per month choose a base may not exceed € 1,870.50, except that exercise their option to that effect before June 30, 2012.

    If in this case and want a change, please inform us as much notice as possible.

    All these changes will have effect from 1 July 2012.

    For any clarification or expansion can contact our office.

    Source: AuthorsBack Top

  • Royal Decree Law 6/2012 of 9 March, on urgent measures to protect mortgage holders out of resourcesRoyal Decree Law 6/2012 of 9 March, on urgent measures to protect mortgage holders out of resources

    The Cabinet on Friday approved a Royal Decree establishing measures to alleviate the problem of evictions for people at risk of social exclusion. It sets out the thresholds which give access to the group to protect the interests of limited delay and reform the procedures of extrajudicial

    Next to the Royal Decree, it includes a Code of Practice which may voluntarily subscribe and financial institutions to be published in the Official Gazette. Once signed, compliance is mandatory and may be invoked before the courts.

    The standard definition sets the threshold for exclusion: it is first and only home and that all family members lack the income derived from employment or economic activities. In addition, the mortgage payment must exceed 60 per 100 of net income they receive all the members of the family unit. They must also lack of assets with which to address the debt.

    Value of housing

    The acquisition value of the mortgaged property must be within the following ranges:

    • For cities with more than one million people: 200,000 euros.
    • For cities of more than five hundred thousand inhabitants or integrated in metropolitan areas of municipalities with more than one million inhabitants: 180,000 euros.
    • For cities of over one hundred thousand inhabitants: 150,000 euros.
    • For cities of less than one hundred thousand inhabitants: 120,000 euros.

    Also for families on the threshold of exclusion, the applicable penalty interest will be calculated by adding the interest on the loan agreed remunerative 2.5 per 100 on the amounts due and unpaid.

    Addressed, also, to Royal Decree Law reform extrajudicial procedures, in order to make them more agile, inexpensive and transparent in line with the judicial enforcement. In particular there is a new online auction system in collaboration with the Ministries of Justice and the Presidency.

    CODE OF PRACTICE

    The reform is completed by a Code of Good Practice for voluntary participation by financial institutions. They must communicate their inclusion in the General Secretariat of Treasury and Finance, who shall publish the list. The code will stay in at least two years and failure to be invoked before the courts by the affected.

    Monitoring will be conducted by a Commission of Control which is a representation of the Spanish Mortgage Association, the Bank of Spain, the National Stock Exchange and the Ministry of Economy. The Control Commission shall publish a yearly report about the degree of compliance with the Code.

    The Code of Good Practice shall apply in the following phases:

    Restructuring of mortgage debt: Debtors in the area of ??exclusion may apply to the entity to restructure their mortgages to make them viable and that payment must be submitted within one month. The plan shall include a lack of capital depreciation in four years, extending the repayment period to forty years and the reduction of interest rate Euribor + 0.25 points. Restructuring may apply for those debtors whose execution procedure is not initiated.

    Measures: If despite the refinancing is not viable to pay the debt, the debtor may request a rebate on the outstanding principal amount. Be considered viable for any restructuring involving the family unit a mortgage payment greater than 60 100 of income. May request you remove all those in enforcement proceedings, provided that the auction is announced.

    Alternatives: If either upstream works, the scope of the exclusions debtor may request payment in the house. It will mean cancellation of the debt with the delivery of housing, along with personal liabilities of the debtor. The debtor may stay a minimum of two years as a tenant paying an annual rent equivalent to 3 100 of the amount of outstanding debt. During this period, non-payment of rent will accrue interest at 20 per 100. The payment in kind shall not apply where the enforcement proceeding is concluded or if the property is encumbered with subsequent loads.

    Source: AuthorsBack Top

  • General guidelines of the Annual Tax and Customs Control, 2012 of the TaxGeneral guidelines of the Annual Tax and Customs Control, 2012 of the Tax

    The Annual Tax and Customs Control, 2012 and is designed to deploy their effects in an economic context characterized by the negative growth of GDP and a deficit in public finances should be corrected throughout the year according to the European Union requirements. If combat fraud has always been a priority at this time is essential.

    The annual plan, which consists of a battery of measures in all areas of the various departments, will be joined shortly a series of policy measures, among which is limiting the use of cash.

    The Tax Office has published on March 1 through the Gazette's general guidelines Tax Control Plan 2012, which is the primary planning tool in the fight against tax fraud. The objective for this exercise is to achieve a turnover of 8.171 million euros for direct control actions, up 8 percent from the previous year's objective.

    This highlights, in the Control Plan 2012, a series of specific measures:

    - Combating the underground economy. Control of residential leases and undeclared business, for which there are already information of power consumption over 35 million properties in Spain, as well as control of goods from Asia, both in imports and in retail.

    - Fight against fraud generates alarm. It will pursue the use of false invoices, the billing for goods and not services, and abuse of abusive corporate forms that are used by groups of professionals, athletes and artists. About this group will begin 1436 inspection activities, up 14 percent from the previous year.

    - Control of income abroad. The Tax Office will use this year from the relevant information for tax purposes with accounts of Spanish residents, or foundations, or corporate webs, Switzerland, Andorra, Panama, Bahamas or Netherlands Antilles, among others. This important development will be carried out under agreements effective information sharing, within the parameters of the OECD, which are signed with many of the countries previously considered tax havens and to take effect in 2012.

    - Fight against fraud smuggled snuff. The Tax Office will pursue the snuff trade of smuggling and the crime gangs that sustain and produce a serious injury for unfair competition. Until February 2012 have been seized 3.5 million packs of smuggled or fake snuff, up from one million in the same period in 2011. Also reinforce actions against trademark counterfeiting.

    - Combating fraud in the collection. Recover those debts may be declared insolvent without being obscure or heritage is one of the main objectives of the tax. This will reinforce the freezing of assets and rights, we will try to secure the payment of debts relating to tax fraud and asked the imprisonment of convicts without being insolvent, are failing the execution of judgments. It also shall continually recurring debtors to establish its financial position and its environment.

    - Coordination with other tax administrations. Be sought particularly abusive tax planning that seeks to take undue advantage of regulatory differences, particularly in the provincial territories.

    Complementing the 2012 annual plan will be developed control policy measures still under technical analysis, such as:

    - Limiting the use of cashor in certain financial transactions.

    - Limiting abuse of certain aspects of corporation tax.

    - Measures to strengthen the system of early reaction against fraud in the tax collection action of debts, produce improvements in equity research and effective collection of fines and civil liabilities for offenses against the public treasury.

    Finally, the Tax Office would like to remember that the most effective fraud prevention is the same and civic responsibility when it comes to paying taxes. This will improve the mechanisms for the correction of minor breaches voluntarily, and in the provision of support services in compliance, as drafts of the income tax. The Tax Office notes that fraud is everyone's problem and tolerant postures benefit the few at the expense of many.

    Source: AuthorsBack Top

  • Arrabe Asesores joins the Spanish Network of United Nations Global CompactArrabe Asesores joins the Spanish Network of United Nations Global Compact

    The Global Compact United Nations (United Nations Global Compact) is a voluntary international initiative and ethical commitment to institutions of all countries to implement as part of their operations and strategy, 10 Principles of Conduct and Action Human rights, Labour Standards, Environment and the Fight Against Corruption. It was driven by former United Nations secretary general, Kofi Annan, today, with over 10 years of experience, the Global Compact initiative is the largest corporate citizenship worldwide.

    The mission of the Global Compact is to promote the implementation of the 10 principles among its signatories, through two areas:

    Learning:

    SMEs provide the necessary knowledge for proper management of corporate social responsibility within the company

    How?

    Providing SMEs in CSR organizing training courses and providing material support conferences, roundtables, workshops, discussion forums, implementation guides, workshops, etc..

    Transparency:

    Encourage communication and transparency of SMEs with its stakeholders through the development of the "Progress Report".

    How?

    Providing practical tools to facilitate communication between business and its stakeholders. The Spanish Global Compact Network has developed an online tool called "Progress Report" to facilitate such communication. It has also adapted the Progress Report to SMEs through a simpler version. The participants in the CSR-SME Initiative developed a Sustainability Report based on the Progress Report.

    Today, the number of signatories of the Spanish Global Compact Network is:

    The Ten Global Compact Principles are based on Universal Declarations and Conventions applied in four areas: Human Rights, Environment, Labor Standards and Anticorruption.

    Human Rights:

    Principle 1: Businesses should support and respect the protection of universally recognized fundamental human rights within their sphere of influence.

    Principle 2: make sure that their companies are not complicit in the violation of human rights

    Labor Standards:

    Principle 3: Businesses should uphold the freedom of association and the effective right to collective bargaining.

    Principle 4: Businesses should uphold the elimination of all forms of forced or compulsory

    Principle 5: Businesses should uphold the effective abolition of child labor.

    Principle 6: Businesses should uphold the elimination of discrimination in employment and occupation.

    Environment:

    Principle 7: Businesses should support a precautionary approach to the environment.

    Principle 8: Businesses should undertake initiatives to promote greater environmental responsibility.

    Principle 9: Businesses should encourage the development and diffusion of technologies that respect the environment

    Anticorruption:

    Principle 10: Businesses should work against corruption in all its forms, including extortion and bribery.

    According to the Expert Forum on Corporate Social Responsibility of the Ministry of Labour and Social Affairs "A company is socially responsible when it responds satisfactorily to expectations about its operation have different interest groups. CSR refers to how companies are governed regard to the interests of its employees, customers, suppliers, shareholders and their ecological and social impact on society in general, ie, a management company that respects all its stakeholders and represents a strategic type approach should be part of the daily management decisions and operations throughout the organization, creating value in the long term and contribute significantly to sustainable competitive advantages. Hence the importance of the organs of government and company management take the perspective of CSR. "

    How do you manage a sustainable SMEs?

    An SME is sustainable when it assumes a responsible and respectful behavior with social and environmental needs of their environment. A sustainable SMEs create value, and not only economic value but also environmental value and social value. Thus, sustainable SME is committed to contributing to the progress of present and future generations, both in their immediate environment and society in general, the short, medium and long term.

    Every day, society demands more engagement of SMEs with their environment, so that reverse to some extent part of their benefits in society, in terms of wealth creation, employment, innovation, knowledge, and in terms of project support social, cultural or environmental. SMEs developing this strategy, no doubt, be more valued its stakeholders, which will result in a stronger position and competitive in the marketplace.

    Through this membership Arrabe Advisors acquires a public commitment to comply with the Global Compact principles

    Source: AuthorsBack Top

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