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  • 08/04/2024 - Gabriel Díaz García  0 Comments

    With effect from 2024, according to Ministerial Order HAC/56/2024 of 25 January, taxpayers subject to Non-Resident Income Tax for obtaining rental income from their properties, will be able to comply with their tax obligations and pay their corresponding taxes in Spain, presenting all their income in a single tax return only once a year. 

    Before 2024, foreign citizens not resident in Spain were obliged to file their rental income every quarter and pay the tax with form 210 if the tax was payable. 

    But this practice forced non-residents to file almost 4 tax returns per year, which meant a cost in time and economic resources for taxpayers, violating the principle of efficiency and necessity that the law 39/2015 on common administrative procedure upholds. 

    So what does this change mean? 

    From 2024, taxpayers will no longer have to file a quarterly tax return, and will be able to file a single tax return grouping all their income and expenses (if they are tax resident in the European Union). 
    At Diaz Advisers we can help you to understand the taxes that affect you, advising you well so that you know what tax advantages you have as a taxpayer. 

    In Alicante on the 8th of April 2024 

    Gabriel Diaz Garcia 
    Fiscal and Tax Adviser 
    Collegiate Economist nº 3611 Alicante 
    Actuary and European Financial Advisor 

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  • 12/02/2024 - Rafael Soler 0 Comments
    How to integrate Corporate Social Responsibility into business strategy ESG

    Due to the constant changes we are experiencing and the challenges we are facing, companies are paying more attention to their Corporate Social Responsibility (ESG) strategies, which often go hand in hand with issues such as inclusion, social innovation, sustainability and ways in which impact can be generated in and from the organisation. The benefits of creating ESG plans in companies (SMEs, family businesses, large corporations and any type of business) far outweigh the drawbacks. The forward-looking entrepreneur knows that taking action is an investment in the business. 
    How does Corporate Social Responsibility benefit my company? Adopting a ESG culture in your organisation has numerous advantages, both internally and externally: it improves corporate reputation and provides differential value. It builds customer loyalty and increases the possibility of attracting new ones. 
    We detail these advantages and help you to implement them in your strategy. 
    #1 Improve reputation. In a scenario in which there is a perceived decline in trust in organisations, companies have the opportunity to implement corporate social responsibility strategies that demonstrate their commitment to society. 
    #2 Reinforce the company's values, especially consistency and credibility. You may think that just saying it is enough, but it is not. You will have to prove it. People now have access to more information, and if what companies say is not consistent with what they do, they will lose credibility. And it's not easy to get it back. 
    #3 Build customer loyalty. If we are able to align the values of the company with those of our customers, the chemistry between both parties is assured. This is the so-called shared value that reinforces customer loyalty and better identifies the company's purpose. If your company is also committed to the growth and good working environment of its employees, to having a positive impact on society and to caring for and respecting the environment, consumers will value it much more highly and will be more loyal to it. 
    #4 Sustainability by example. Actions as simple as not using air conditioning when it is not needed, or not printing documents unless it is necessary, or turning off devices that are not being used, among other things, considerably reduce costs and you will also be reducing the negative impact of your operations. Going one step further is simple, such as encouraging people to cycle, walk or take public transport to work. It's about analysing and changing everyday decisions. 
    #5 Increased access to finance by incentivising fundraising. Socially responsible practices reduce the company's contingencies and allow it to control them, reducing any possible risk. In this way, they offer added value that increases the value of their shares and reinforces the confidence of potential investors. 
    #6 Increases the attraction and retention of talent. When people enjoy and value the work they are doing, their performance and loyalty to the company increases considerably. Today's society likes to be part of organisations that respect the world, and also invest capital and time to continue training its members. 
    #7 Improves the working environment. When companies have a culture of Corporate Social Responsibility, they can easily promote volunteering among their employees and encourage them to collaborate with non-profit organisations. Altruism is an intangible that every company should promote. By improving people's motivation, skills and self-esteem, we foster pride in being part of the company and reinforce their involvement and commitment to the organisation. 
    You are probably wondering what kind of actions companies can take as part of their ESG plans. Here are a few examples: 
    1. Support employee involvement in social causes. 
    2.       Make responsible use of energy, e.g. by promoting the use of renewable energies such as solar energy. 
    3.       Collaborate with local NGOs to contribute to sustainability by raising funds for charitable causes. 
    4.       Promote and support recycling, both in terms of company activities and by raising awareness among employees. 
    5.       Organise events, acts or solidarity races to raise funds for a social cause that has an impact on my locality. 
    6.       Ensure equal opportunities in the company. 
    7.       Implement measures to reconcile work and family life. 
    8.      Align my suppliers with a system of good practices that guarantees the sustainability of my production or services chain. 
    11. Apply transparency principles and policies with my customers.  
    Companies that are aware of ESG principles tend to generate levers that truly transform society. ESG plans are as important as the business itself, and demonstrate those values that we all seek as citizens and consumers concerned about the environment and social impact. 
    At DA Advisers we help you to implement your ESG strategies and generate shared value with your stakeholders, enhancing countless advantages such as those we have just described. Being a socially responsible company adds value and differentiation to your brand and your organisation.  
    Do not hesitate, facts make the difference.  
    Rafael Soler 
    Consultant for socially responsible companies. 

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  • 12/02/2024 - Gabriel Díaz García 0 Comments
    Tax advantages for foreign entrepreneurs and workers in Spain

    The Beckham law

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  • 12/02/2024 - Gabriel Díaz García 0 Comments
    Buying a property in Spain

    The importance of counting on a professional economist

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  • 12/02/2024 - Gabriel Díaz García 0 Comments
    Capital Gains on the sale of Property in Spain: keys to reduce taxation

    Keys to reduce taxation

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  • 12/02/2024 - Gabriel Díaz García 0 Comments
    Taxation of Tourist Rentals

    Every saver has at some time thought of investing his savings in a second home, because it is an asset that has a series of advantages in contrast to other assets (such as financial assets or artistic assets) that require knowledge that not everyone has. 
    Among the advantages of acquiring a second home are, roughly speaking: 
    -It is a tangible asset, i.e. it is not an account entry floating in the telematic space of the world's computers and monitors. 
    -We can make use of it during our holidays or even let our relatives use it. 
    -We can obtain an interesting income: income from renting or transferring the property, or capital gains from the transfer of the property title in the future.  
    -It is a "pension plan" for our retirement: an interesting way of obliging ourselves to save periodically (if there is external financing, i.e. mortgage) in order to consolidate consolidated rights in the future. These vested rights, i.e. the market value of the property, will depend on many exogenous factors such as the area where the property is located, the economic cycle, legislation... 
    Recently, three other factors have come into play that only two years ago were so improbable that nobody had in mind when weighing up the risk of this type of investment: 
    -Climate change: many scientific studies already predict a rise in sea level that will inevitably affect areas bordering the coast. That is the case of La Manga del Mar Menor in Murcia and many other towns. Investing €400,000 in a penthouse on a beach with a high probability that it will be impracticable in the future is a somewhat risky decision. 
    -Pandemics: Covid 19 has put on the table what some Economic Gurus, such as Bill Gates, already announced a few years ago and it is the risk that exists today of the emergence of new diseases. The impact of Covid on world tourism has been devastating. 
    The almighty tour operator Thomas Cook collapsed the national market at the end of 2019 but the effects of Covid 19 have caused GDP to fall by more than 106,000 million euros in 2020, that is, a 68% drop compared to 2019 revenue. 
    Not to mention the stock market crash of the hotel companies and the aviation sector listed on the Stock Exchange. 
    If we choose to invest a certain amount in a property, hoping for a certain rate of return, it may be that for one of these reasons, you have an empty apartment for so long that the opportunity cost of not having invested that money in other assets is high. 
    -Social riots: we saw how the pro-independence social riots in the heart of Barcelona affected merchants and residents or how in the main cities of Spain, riots broke out due to the discontent of the younger population due to the imprisonment of a "rapper" for call this character somehow. 
    These are some of the most important advantages of acquiring a property as an investment. We could list many others but I will take these as the most noteworthy. 
    But we must also weigh the disadvantages: 
    -High payment of taxes at the beginning and during the life of the asset: depending on whether we are talking about VAT or Property Transfer Tax, the truth is that we must face the payment of between 4% (super reduced rate) or 10% on the purchase price, in the purchase of a home, together with the invoice of the corresponding Notary and the Land Registry. Not to mention the municipal taxes that are accrued each year, home insurance and maintenance, repair or conservation expenses. 
    From an IRPF or IRNR point of view, we also have the obligation to attribute an income to our income, called Income Imputations, for the mere fact of having a second home. 
    What's more, the AEAT does not care exactly whether our home is expected to be rented, because according to a recent ruling by the Supreme Court, the period of time in which the home is not rented must be considered for the purposes of article 85 of the Personal Income Tax or 24 of the IRNR as an imputed income and to make matters worse, the expenses that have been incurred to set up that house, will not be tax deductible. 
    -Risk due to insolvency: if a bad economic period befalls us, we can fall into default or even lose the property, also losing all the money (or even our personal assets) that we have invested in it, until paying off the debt and the contracted responsibility. 
    -Liquidity risk: if we need liquidity for any compelling reason, liquidating a property can be an operation that takes months or even years and the worst thing is that, if we need the money immediately, our negotiating power in the sale price would be clearly reduced, so it is likely that we will have capital losses 
    -Risk for renting in habitual residence: breach of contract by tenants, damage to the property, collapse in general justice that slows down eviction procedures, etc... make the owner fear who increasingly opts for vacation rentals in the short term (which is not 100% risk-free either…) 
    As a Financial and Tax-Fiscal Advisor, I always advise my clients to choose those assets that best suit their personal circumstances, because for that there is a wide variety of assets and possibilities. 
    The investment time horizon, risk aversion, cash flow generation capacity, family circumstances and expected return-risk (Sharpe Ratio) are, among others, some of the pillars on which we must base our investment decisions. 
    Additionally, we must incorporate good tax planning that encompasses the treatment of profits and income generated and the future transmission to our heirs. 
    In our next article we will deal in depth with the details of the taxation of the tourist vacation rental 
    In Alicante on May 3, 2023 
    Gabriel Diaz Garcia 
    Collegiate Economist of Alicante 3611 
    Actuary and European Financial Advisor 

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  • 07/09/2023 - Gabriel Díaz García 0 Comments
    Notarisation of documents before a notary

    What documentation is required

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