New Tax Office criterion for business expenses in Spain

There are some important changes to the criteria associated with expenses for cars, entertainment, motorway tolls etc.  at the Tax Office in Spain. 

From now onwards, the Tax Office requires an explanation for each receipt, invoice or expense presented to ensure they are truly related to the activity.

They are particularly interested in cars and everything related to them (petrol, repairs, maintenance, etc).

They are analysing each claim and are being extremely strict and are rejecting them if they don’t conform. In some cases they are actually penalising people.

All companies and freelancers that include these expenses must justify that the use of the car is 100% for the activity of the company and is not for personal use.

It is very difficult to reach a justification of 100% unless you are a professional driver e.g. taxi, delivery driver, truck driver, commercial agent, etc. It is even more difficult when it comes to vehicles considered “luxury”.
 
The Tax Office generally agree to include 50% of IVA and expenses.

If the company’s activity does not require the use of a vehicle that percentage can be reduced to 0%.

From our point of view, we recommend you work within the above parameters and terms to avoid problems with the Tax Office.
 
Please do not hesitate to contact me if you require clarification. 
 
Carlos Jiménez Dengra
Director general | Managing director

Urbanización Alhambra del Mar
Centro de Negocios Tembo
Bloque A Oficina 9
29602 Marbella (Málaga)

Tel       +34 951 607 006
Fax      +34 952 901 051