The Law for the promotion of the ecosystem of emerging companies (known as the “Startups Law”) has recently been approved in the Congress of Deputies, which will be published in the BOE in the coming days, and will take effect from the 1st of January 2023.
Relevant modifications to tax laws and tax incentives for this type of companies are approved, with the objective of increasing the investment of emerging companies in Spain by 20% in less than 3 years.
The most relevant points of this law are as follows:
Scope of application: start-ups (technology-based) that meet the conditions of:
- Being newly created, or that no more than 5 years have elapsed since registration in the Mercantile Register.
- Not having arisen from a merger, spin-off or transformation of companies that are not considered to be emerging.
- Have its registered office or permanent establishment in Spain.
- At least 60% of the workforce must be employed in Spain.
- Not distribute dividends.
- Not be listed on a regulated market.
- If they form a group of companies, each of the companies must comply with the above requirements.
End of application of the incentives (main reasons):
- Failure to comply with some of the above requirements.
- The end of the 5-year term.
- Being acquired by a non-emerging company
- Exceeding a turnover of 10 million euros.
Certification as an emerging company: this must be requested by ENISA. There will be positive administrative silence if ENISA does not respond within 3 months.
Tax incentives for start-ups:
- The corporate tax rate will be 15% in the first year in which it has a positive taxable base and the following three years.
- Deferral of taxation in IS (“Corporate Tax”) is allowed for the first two years with a positive taxable base, to be requested at the time of filing the self-assessment tax return.
- Delivery to employees of shares or holdings in the company itself (stock options): The exemption is increased from €12,000 to €50,000 for employees of start-up companies. In addition, in the particular case of options on shares of emerging companies, taxation for the exercise of the option is deferred at the time the option is exercised, that is, at the time of sale.
- Deduction for investment in start-ups (Personal Income Tax, “IRPF”): The deduction rate is increased from 30% to 50%, while the deduction base is increased from €60,000 to €100,000.
Special regime for workers moved to Spanish territory (Beckham Law):
- The number of tax periods prior to moving to Spain in which the taxpayer cannot have been a tax resident in Spain is reduced from 10 to 5 years.
- The scope of application is extended to those workers who, regardless of whether moving to Spain has been ordered by the employer, are working remotely (digital nomads), for which an international remote visa will be required.
- The spouse and children under 25 years of age of the main taxpayer will also be eligible for this scheme if certain requirements are met.
– Allowance for workers registered as self-employed and employees at the same time an allowance of 100% of the contribution of the base established in general, during the first 3 years, is foreseen for workers who are registered in the self-employed regime as they have effective control of an emerging company and who simultaneously work as employees for another employer.
If you have any doubts related to this or other tax, accounting, or legal issues, please do not hesitate to contact our tax advisors in Barcelona.