VAT services for Amazon FbA sellers

VAT registration in Spain and related services are in high demand due to the boost in online trading. We have set up a devoted team to handle the Value Added Tax (VAT) reporting and payment to the Spanish Tax Authorities for Amazon sellers using FbA.

Our services include:

VAT registration in Spain

We do the registration by means of a Power of Attorney (“PoA”), which must be legalized and apostilled (the Hague Apostille). If the country of origin of the seller is not a member of The Hague Convention, then the document must be authenticated by the Spanish Consulate in that country. We provide the wording of the PoA which is written in two columns (Spanish / English), so that no additional translations are required. In order to be registered, a proof of existence of the seller must also be provided to the Tax Office.Once we receive the original PoA, the registration takes 2-3 days. We also apply for the EU VAT number, so that the Spanish VAT number is registered in the VIES.

While the domestic VAT number is given automatically by the Tax Authorities, the inclusion in the VIES can be delayed up to 60 days and is subject to a due diligence process by the Tax Office, to avoid fraudulent registrations. More often than not, the seller receives a letter of the Tax Office requesting additional information. In this respect, it is important to be sure of answering this letter on timely basis and to provide the Tax Office with clear explanations. Our experience is that many sellers have failed to get registered in the VIES because they did not even receive the letter (for instance, some of them gave as their Spanish registered address the one of the Amazon Fulfilment Center in Madrid). Others, simply did not understand what is required from them or assume that the tax official is aware of the FbA system. Since we have a lot of experience dealing with this matter and have a very fluent relationship with the tax officials, our clients rarely experience such pains.

VAT reporting in Spain

We prepare and submit the  monthly or quarterly VAT returns and the annual summary

Our reporting is based in the Amazon VAT Transactions Report. To know more about this report, see our post about the Amazon VAT Transactions Report

To know more about the dates and process of declaration, please refer to our post VAT compliance in Spain

We also prepare and submit on monthly basis the intrastat and EU intracomunity transactions statement (form 349) reports for the Amazon sellers obliged to do so because they have exceeded the legal thresholds. The EU intracomunity statement is required for for sellers involved in cross border selling who, in the Cross Border Fulfilment Settings of the Amazon FbA configuration page, have allowed their inventory to be stored in Spain.

This is the time line of the reporting process (example for 2018 Q1):

Diagram for VAT reporting in Spain
VAT reporting for FBA sellers
Handling the payment of the VAT due to the Tax Authorities

Unfortunately, at the time of this writing, the payment of taxes in Spain can only be done though a Spanish bank account, even for sellers belonging to the SEPA. Therefore, Amazon sellers must either open a bank account or use the services of a third party to make the payment.

Please refer to our post how to pay taxes in Spain to learn more about this issue.

Unfortunately, opening a bank account for non residents is becoming a nightmare due to the rules to prevent money laundering. The process to open a bank account is time consuming and stressing and for more Amazon sellers it is simply not worth the time and effort. We make the payment of the VAT easy, since our clients just send the funds due to the Tax Office to our deposit bank account, from where we deliver the money to the Tax Office, together with the Tax return.

Tax representation

Non-EU Amazon sellers are obliged to appoint a fiscal representative who is resident in Spain. The Tax Authorities will then get in touch with them for any issue arising with the payment of their taxes. although EU sellers are not obliged to appoint a fiscal representative, our experience is that in absence of such representation the liaison with the Tax Office becomes difficult. Moreover, if the Amazon seller does not appoint a fiscal representative, they would be required to apply and install an e-certificate, because otherwise they will not be able to communicate with the Tax Office at all.

See our post about how to communicate with the Tax Office in Spain

VAT advice

We provide advice and guidance to our clients about their doubts regarding their VAT issues. For instance, the tax rate applicable to certain items that they sell in Spain, if they have to charge VAT in a certain transaction etc.

Administrative services

It is sound business practice trying to keep running cost at a minimum at the outset. We fully understand the needs of our foreign clients and try to help them in this first steps. We provide tailor made solutions in the following areas:

a) Facilitate the opening of a corporate bank account

b) Obtain local permits if necessary

c) Virtual office: provide legal address, infrastructure (computers, office space, etc.)  needed to operate in the Spain, one or more dedicated phone lines (answered with clien’s name)

d) Prepare the company invoices and send them to the clients

e) Monitor all due dates for Account Receivables Invoices.

f) Solicit payments from Clients before and especially after Invoice due dates.

g) Monitor payments to suppliers and report the client all due dates

d) Provide the Company with regular reports on invoices issued, payments received, cash situation, open receivables and payables

e) Cloud accounting so that the client has 24×7 access to his records

f) Act as importer of record for the Company’s Products.

g) Act as the distributor for the Company’s Products

h) Manage the importation of the Company’s products and settle Customs procedures.

i) Manage the delivery of all Products to the Clients

If you have any particular need, do not hesitate to contact us to discuss the matter. Thank you

Expatriates

Expatriates coming to Spain, whether they are seconded by their employers, self employees or pensioners face many tax issues. A correct understanding of these issues is key to avoid costly pitfalls or incurring involuntarily in tax infringements. Common issues that must be addressed are:

  • Obtaining a Number of foreign Person (NIE, for its Spanish acronym)
  • Registering in the Tax Office and getting a Tax Identification Number (called NIF, for its Spanish acronym)
  • Applying for the non-resident status (also called, “Beckam Law”)
  • Registering as a self employee in the Tax Office
  • Registering in the Social Security Office
  • Enrolment in the Public National Health Service to enjoy
  • Personal Income Tax compliance
  • Foreign assets disclosure requirements
  • Determining the tax residence status
  • Tax planning for high net worth tax payers

Some of these issues may seem straightforward. However, our experience is that many people tend to choose sub-optimal decisions or, even worse, mistaken options. Let us analyze a few examples:

One feature of the Spanish tax residence rules is that during one single fiscal year a taxpayer cannot be resident for one period and non-resident for another period.  That is, during a calendar year, the taxpayer is either resident or non-resident, but cannot be both.  Therefore, if an alien moves to Spain during the first semester of any year, he would be deemed to be resident for the whole year, and taxed as a resident for the foreign earnings corresponding to the period prior to the transfer.  This can result in double taxation.  Therefore, careful consideration as to the timing of the move is highly recommended. We advice our clients what to do (and what to avoid) before moving to Spain.

Since the reintroduction of  the Net Worth tax  a careful structuring of the tax payer assets, frequently using investment companies, can dramatically reduce the tax burden for the tax payer and also mitigate the taxes to be paid for their heirs.

The option for the non-residence status, which basically allows the tax payer to be taxed at a flat tax rate of 19 % (for European Union residents) or 24 % (non EU residents) on their Spanish source income seems the best course of action, and certainly is for high income earners. However, standard employees should consider waiving this regime, because the standard Personal Income Tax may turn out to be better for them, due to the numerous allowances and reliefs. We customarily analyze the different scenarios available to the client in order for them to make the right tax choice.

Pensioners also need to determine where they have to pay tax on their pensions or savings. A careful review of the applicable Tax Treaty and the type of income is absolutely necessary. Many people need to know in advance what is their expected future tax burden before taking the decision to move to Spain. We have a lot of experience making these kind of analysis, even for tax payers coming from countries with trigger  complex tax issues (for instance from United States).

Since we have a long dated expertise dealing with these matters, we can offer very competitive fees. Our price list for routine services are

Item  Price (EUR)
Obtaining a Number of foreign Person (NIE, for its Spanish acronym) 300
Registering in the Tax Office and getting a Tax Identification Number (called NIF, for its Spanish acronym)
Applying for the non-resident status (also called, “Beckam Law”) 150
Registering as a self employee in the Tax Office 150
Registering in the Social Security Office 150
Enrolment in the Public National Health Service to enjoy 250
Personal Income Tax compliance (starting from) 300
Foreign assets disclosure requirements (starting from) 500

 

If you are interested in hiring our services please feel free to contact us.

Real estate

Avoid problems when buying a property in Spain.

In this respect our aim is to make sure that the prospective buyer of a Property in Spain does not encounter unexpected problems or pitfalls. Among others, our services include:

a) The vendor is the legal owner of the property

b) There are no charges or encumbrances on the property nor judgements affecting the property, or orders against the vendor

c) There are not adverse registrations pending against the property.

d) The vendor is entitled to dispose of the property

e) Ensure that the property is free from all outstanding debts and charges, specially accrued taxes.

f) Verify, in the case of newly-constructed properties, that the developer has local planning permission and any other administrative licenses required by the Law

g) Formalize or review the sale – purchase private contract with the seller according to the needs of our clients.

h) In case of deposits, we take care that the amounts paid are duly ensured by the vendor.

i) Review and check the public deed to be signed before the notary.

j) In case of leveraged purchases, review of the loan agreement

k) Arranging payment Transfer Tax, notary fees and land registry fees.

l) Handling registration of the property at the Land Registry Office and in the Cadastral Registry

You may be intererested in learning about the taxes to be paid in Spain when buying a property. We encourage you to visit our post about the taxes when buying a property in Spain.

Payroll Services

Our firm has been offering payroll services in Spain for more than 20 years. We have a English speaking dedicated team which  offers a fully managed payroll  service.

Among others, we offer:

a) Drafting employment contracts, including top management ones

b) Social security registration, both for the company and for the employees

c) Payroll calculations

d) Issuance of payslips

e) Payment processing

f) Payroll Tax

g) Social Security Contributions

h) Employer’s tax reporting

i) Leave administration

j) Expatriation services

Go to the following link if you want to have a grasp on the basic features of the Spanish Social Security Contributions. You may also be interested in reading about the taxation of employment income in the Spanish Personal Income Tax. We encourage you to visit the site of the Spanish Social Security Authority, where you can find a ton of information about Social Security matters, such contributions, pensions, expatriates and more

Company Law

Contracts, shareholders and Directors resolutions.

The in-depth knowledge and expertise of its professionals enables our Corporate Law Department to provide advice across all corporate law-related areas: M&A, commercial contracts, corporate law and finance,The lawyers in our Litigation and Arbitration Department advise in lawsuits conducted before the Spanish courts and in ad hoc arbitration proceedings before the principal courts of arbitration. They defend their clients’ interests in order to avoid potential disputes and, where they are unavoidable, to ensure they are best placed to deal with them.

Our lawyers, making use of out-of-court procedures and court proceedings (such as pre-insolvency procedures and formal insolvency proceedings),take charge of implementing restructuring financial plans. On the creditor side, they design the most efficient debt collection and recovery strategies.

We encourage you to visit the site of the Spanish Ministry of Justice, where you can find a good number of relevant Laws, either commercial and others,  translated into English, like the Code of Commerce, the Insolvency Act, the Consumers Law and many more.

Tax services

More than 25+ years of experience dealing with taxes.

Our firm was founded as a tax boutique. Taxation is still our main area of expertise and represents more than half of the firm’s turnover. Our main areas of work are Corporation Income Tax, Personal Income Tax and Value Added Tax (“VAT”). However, we also deal with other tax issues, like Inheritance Tax, which has a lot of impact in alien individuals.

We provide tax planning and guidance services in, among others, the following taxes:

  • Corporation Tax
  • Value Added tax (VAT)
  • Accounting and financial advice
  • Group taxation
  • Tax optimization of salary packages
  • Tax treaties
  • Transfer Pricing in coordination with the Group Tax Department
  • Tax advice and compliance to expatriates

In these fields, we offer a broad range of tax services , among others:

Advice and consultancy

Regarding the general company’s tax policy. Our team is continuously engaged in tax research to find legal ways to optimize the tax payer position. Some people call this approach “loophole” tax planning.

Transfer pricing

To ensure that the company fulfills with the documentation requirements of the Spanish Law and that related party transactions are valued are arm’s length basis.

Tax audits

The Tax Office has the legal right to check the accuracy of the tax returns during a period of four years (statute of limitations). Our team is there to make sure that the client has the necessary support to avoid unexpected tax assessments and penalties.

Tax litigation

When things go wrong the tax payer must go to the Courts to support its tax criteria. We have an impressive track record both at domestic Courts (Tax Court, Regional High Courts – “Tribunales Superiores de Justicia” – and Supreme Court – “Tribunal Supremo”-) and in European Union legislation related cases.

Tax preparation services

As the name suggests our expert team prepares and / or reviews the tax returns that companies and individuals must file. If you want to have a feeling about the diferent dates involved, kindly visit our post with a completely updated calendar of the tax and legal obligations in Spain

Tax diu diligence

This is an important part of our practice. Before acquiring an asset, business or company the acquirer must be sure that all contingencies or hidden risk are accounted for. Our job is to review all the tax documentation to ensure that the tax policy is fully in compliance with the laws.

International tax

International tax involves the advice about the most suitable legal form for foreign business; optimize financing, tax status of expatriates, reducing withholding taxes on outbound income, treaty shopping and the like.

Mergers & Acquisitions

Taxation is one of the key considerations when structuring an M&A deal. Asset purchases vesus stock purchases are a classic dilemma in these transactions. When the target company is paid for with shares of the acquiring company a merger takes place. An in depth analysis of the tax implications of all the alternatives available (stepping up of the assets cost basis, NOL carryforward…) is a must to ensure that the structuring of the deal is optimum.

We encourage you to visit the site of the Spanish Tax Office, where there is a lot of useful and updated information on tax matters. They do have an English version of the site.

The head of the tax department of the firm is Emilio Alvarez Arjona, tax and accounting expert

Accounting

Tailor-made innovative solutions in accounting and bookkeeping.

Each client is unique and has his own working processes and needs. So rather than imposing our clients a predetermined way to do things, we just  adapt to our client needs, specially regarding reporting schemes. We are an accounting firm in Spain proud to use state of the art accounting software, like most cloud accounting software (Xero, Wave…). You may find interesting reading about our approach to the accounting tasks in our article about how to comply with the accounting requirements of the Spanish Law. Our services in this field are, among others, the following:

a) Codification of the company set of accounts, in compliance with the needs of the company and the economic sector it is involved in.

b) Bookkeping: recording of all the company accounting documents (invoices, payrolls, national insurance, cheques, etc.)

c) Reconciliation of bank and other personal accounts.

d) Preparing the following compulsory books and records required by accounting and tax regulations: Journal, General Ledger, Quarterly Trial balances, Profit and Loss Account, Balance Sheet, Notes to the financial accounts, Cash Flow statement, Changes in equity statement, Payables Register, Receivables Register, Fixed assets records.

e) Legalizing the compulsory accounting books (Journal and Inventory and Annual Accounts book) in the Mercantile Registry

f) Drawing up and follow-up of the Annual Financial Accounts and Management report and submitting and recording them in the Mercantile Registry.

Some clients, specially at the outset, need full support in their first steps in Spain. Those clients may find useful our virtual office and administrative services, which will help minimize their running cost at a very reasonable cost.Besides this pure accounting tasks, we also take care of the secretarial services required by the law:

a) Legal advice and preparation of the minutes of the annual

b) General Shareholders Meetings and of the Board of Directors meetings.

c) Recording, custody and keeping of the Minutes Book of the company (any minutes which have not been drawn up by us must be sent to us by e-mail).

d) Legalisation, custody and keeping of the Shareholders Register.

We encourage you to visit the site of the Spanish Accounting Supervisory Body (the “ICAC”), where there is a lot of interesting accounting information in English, like the Spanish Accounting Plan, which sets the codes of all the accounts and the compulsory layout of the year-end financials:  Balance Sheet, the Profit and Loss Account, the notes, the Cash Flow report and the Equity changes.

Company formation

We can set up any type of company admitted in Spanish Laws, Partnerships, Limited Liability Companies or Public Limited Companies. As a matter of fact, company formation is one of our core service.

Our services include al the task involved in the incorporation of a company, among other:

a) Request of the “Certificación Negativa del Nombre” – a Certificate stating that the company name you intend to use is not already taken.

b) Application for the company Tax Identification Number (“NIF”) for the foreing investor, the new company and the directors of the company.

c) Opening of a bank account in order to fund the company in formation. The bank must issue a certificate stating that the funds have been received for the capital of the company in formation.

d) Writing of the official by laws of the company

e) Filling in of forms for the Capital Tax

f) Registration of the company at the local Mercantile Register

g) Registration of the company before the Tax Authorities and in the National Social Security Scheme.

If properly organized, a Spanish company can be incorporated in a two weeks, after the relevant docs have been received. Please kindly contact us for further information.
Some clients find useful to avail from our virtual office and administrative services support, at least at the outset, to keep running cost low.

To learn more about the company formation process and the most relevant legal features of Spanish companies, please read our article on company formation in Spain. 

You may also be interested in consulting our section of Frequently Asked Questions (“FAQ’s”) about company formation

VAT

We offer a comprehensive VAT pack of VAT services, including VAT registration, compliance and defense services against tax assessments of the tax authorities. Our expertise in this field arise from more than 20 years involved in complex cross border transactions, both in the supply of goods and services. Among other, our services include:

a) Value Added Tax (“VAT”) and Fiscal representation

b) VAT registration / de-registration;

c) EORI registration

e) Preparation and submission of all VAT declarations: VAT returns (monthly or quarterly), Annual Recapitulative summary of transactions with suppliers and customers over EUR 3,000, Intrastat, EC  recapitulative transactions statement

f) Keeping VAT compulsory books

g) Assistance in VAT audits by the Tax Authorities

h) Appeals against Tax Assessments before the relevant Tax Court and, eventually, the High Court

i) VAT advice and planning

j) Regular information on Spanish and EU VAT developments (tax rulings, Court Judgments, legal changes…)

k) VAT education and training

We also provide tailor made services devoted to Amazon Sellers using FbA

If you are interested in knowing more about the compliance dates required by the Spanish legislation we encourage you to visit our post about the tax and accounting compliance obligations in Spain.