Publications

Awarded judicial costs are only taxable over and above the cost of the fees of a lawyer and court procedural representative

A decision by Murcia Regional Economic Administrative Tribunal (TEAR) concluded that the capital gain obtained from collecting the legal costs received by the successful party in a lawsuit must be calculated by reducing the received indemnification by the fee expenses paid.

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Judgments

• Corporate income tax.- The contribution of a property encumbered with a mortgage cannot be taxed under the neutral regime on the portion of the debt that did not fund the acquisition 
• Inheritance and gift tax.- The main source of income may, in exceptional circumstances, be a source from the year before death 
• Administrative procedure.- A change of interpretation cannot have an adverse effect on the taxpayer
• Administrative procedure.- Rendering general provisions null and void does not automatically render null and void decisions based on them 
• Administrative procedure.- A notification is valid if it is proved that the taxpayer was aware of its content
• Management procedure.- A provisional assessment decided in a procedure initiated through a return has precluding effects
• Review procedure.- A request for a preliminary ruling is needed before deciding that domestic law is not applicable
• Penalty procedure.- Liability for collaborating with a tax infringement cannot be shifted and a serious penalty imposed for the same facts

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Decisions

• Corporate income tax.- Directors’ compensation should have been set out with certainty in the bylaws (at least under the legislation before the current Corporate Income Tax Law)
• VAT.- Effective use or enjoyment of a service must be evidenced to determine whether it is subject to VAT
• VAT/Transfer and stamp tax.- The definitions of “independent business unit”, for VAT purposes and of “whole set of business assets, rights, and liabilities”, for transfer and stamp tax purposes, must receive the same treatment
• Administrative procedure.- It is correct to notify the taxpayer even if the taxpayer has appointed a representative to receive notifications
• Audit procedure.- The time period for rendering a second assessment decision runs from when the auditors receive the decision on reversion of the procedure
• Collection procedure.- The time period for rendering a new decision shifting liability after a previous decision has been set aside is six months
• Penalty procedure.- Not reporting income not mentioned in the information provided by the tax authorities is allowed to be subject to a penalty

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Rulings

• Corporate income tax.- Partially exempt entities may use the capitalization reserve
• Corporate income tax.- Indemnification payments from insurers to cover penalties are taxable
• Personal income tax.- Where the same discounts are offered to own employees and employees of other companies, there is no income in kind
• Inheritance and gift tax.- An inbound expatriate receiving a gift may apply the legislation of the autonomous community where they reside
• Inheritance and gift tax.- Disclaiming an inheritance after the tax has become statute-barred implies there is a gift
• VAT.- The DGT examines the VAT implications of flexible compensation plans

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Legislation

• Corporate income tax return forms for fiscal year 2018 have been published
• Reductions for 2018 of given indexes for the objective assessment method for personal income tax have been approved
• New tax stamps for cigarettes and loose tobacco
• The rules on completing the electronic internal administrative document and form 525 have been amended

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