Corporate Tax in Spain: Rates, Rules & Compliance Guide

What is Corporate Tax in Spain?

Corporate Tax in Spain is a direct tax on company profits earned during a financial year. It helps fund public services across the country with a general tax rate of 25% and other rates ranging from 10% to 30% depending on the type of entity.

This blog will explain everything you need to know about Corporate Tax in Spain.

What is Corporate Tax in Spain?

Corporate Tax in Spain is a direct tax applied on income earned by companies and legal entities over a tax period.

This tax is paid by all entities resident in Spain unless they are fully or partially exempt based on their type or activity.

It applies across all Spanish territory, including the Balearic Islands, Canary Islands, Ceuta, Melilla, and nearby maritime zones. 

Who Should Pay Corporate Tax in Spain?

Corporate Tax in Spain must be paid by all companies and legal entities that are tax residents in Spain except when they qualify for a full or partial exemption.

1. Resident Entities

A company or entity is considered resident in Spain if it meets any of the following:

• It is formed under Spanish law
• It has its registered office in Spain
• Its main management or business decisions take place in Spain

Examples of resident entities that must pay tax include:

• Public limited companies (S.A.)
• Limited liability companies (S.L.)
• Cooperatives and associations
• Foundations and state-owned enterprises
• Investment and pension funds

2. Non-Resident Entities with Permanent Establishments

Foreign entities must also pay Corporate Tax if they operate in Spain through a permanent establishment such as a branch or office and in this case they are taxed only on income connected to their Spanish operations.

3. Exempt Entities

Some entities are fully exempt, such as:

• The State and its public bodies
• Social Security funds
• Certain academies and official institutions

Others are partially exempt, like:

• Non-profit organizations
• Religious institutions
• Political parties and trade unions

Corporate Tax Rates in Spain

In 2025, the standard corporate tax rate in Spain is 25%, and reduced or special rates apply for certain entities depending on their size, activity, or legal status.

Tax Incentives in Spain

A company that pays Corporate Tax in Spain will be able to reduce part of the tax by using certain incentives. These incentives will apply only if the company meets the rules given in the law.

1. Capitalisation Reserve

• Companies can deduct 15% of the increase in their equity.
• The equity must be kept in the business for at least 3 years.

2. Renewable Energy Installations

• Full deduction (up to €500,000) is allowed for systems that use renewable energy.
• The system must replace an older one that used fossil fuels.
• Companies must keep their average number of employees for 24 months.

3. Electric Vehicles and Charging Stations

• Businesses can deduct the full cost of new electric vehicles and charging points.
• Applies to investments made in 2024 and 2025.
• The assets must be used for business purposes.

4. Non-Profit Entities

• Eligible non-profits pay a reduced 10% tax rate.
• Donations made to these entities can be deducted:
  • 40% normally
  • 50% if the donor gives to the same entity for 3 years in a row
• The maximum deduction base is 15% of taxable income.

5. Canary Islands (ZEC Regime)

• Companies operating in the ZEC (Canary Islands Special Zone) can pay a reduced tax rate of 4%.
• Other tax benefits are available for investing in the region.

6. Balearic Islands Regime

• Companies in agriculture, fishing, and similar sectors can set aside part of their profits for investment and pay less tax.
• They must report this using Form 283 along with their tax return.

Non-Deductible Expenses in Spain

When a company calculates its Corporate Tax not all expenses will be allowed as deductions because some costs are not accepted under the tax law even if they are part of the company’s accounts.

The following are the main types of non-deductible expenses:

• Fines and penalties paid to government or courts
• Gifts and donations unless they meet special legal rules
• Corporate Tax and similar taxes including the Complementary Tax introduced in 2022
• Expenses not linked to business or without proper proof

Corporate Tax Return and Payment in Spain

A company that is subject to Corporate Tax in Spain will need to file a tax return each year to report its income and must also pay the tax due within the same filing period.

Form Used

• The main Corporate Tax return must be filed using Form 200.
• Companies under the consolidated tax regime must use Form 220.
• Companies with related-party transactions or dealings with tax havens must also submit Form 232 as an informative declaration.

Filing Deadline

• The return must be submitted within 25 calendar days after the first 6 months of the tax year.
• For example, if the financial year ends on 31 December, the deadline will be 25 July of the following year.

Who Must File

• All resident companies, unless they are fully exempt.
• Partially exempt entities and non-profits must file if they earn taxable income.
• Even dormant companies must file if they are registered and have legal personality.

Filing Method

• The return must be filed electronically through the Spanish Tax Agency’s website.
• A digital certificate is required to submit the form.

Payment of Corporate Tax

Payment Deadline

• Tax must be paid within the same 25-day filing period.
• For most companies with a year-end on 31 December, the payment deadline is 25 July of the following year.

How to Pay

• Payment must be made online through the Spanish Tax Agency.
• Accepted methods:
  • Direct debit
  • Credit or debit card
  • Bank transfer
  • BIZUM (instant mobile payment platform)

Advance Payments

• A company must also make 3 advance payments during the year using Form 202.
• Due dates: April, October, and December.
• The amount depends on either the last filed return or current-year profit.

Record Keeping Obligation in Spain

A company that pays Corporate Tax in Spain must keep proper records to show how it earned income and calculated tax so the records will be available if asked by the Spanish Tax Agency.

Key requirements:

• Maintain complete and accurate accounting books
• Record all income, expenses, assets, and debts
• Keep invoices, contracts, bank slips, and other documents
• Store all records for at least 6 years

Conclusion

Corporate Tax in Spain has a standard rate of 25 percent and applies to both resident and certain non-resident entities on company profits earned during a financial year. Businesses should know their tax duties and file returns on time.

E-invoicing in Spain is already mandatory for B2G transactions and will soon become mandatory for B2B as well. Businesses should start preparing by understanding the requirements and upgrading their invoicing systems.

Flick’s e-invoicing software is fully compliant with Spain’s regulations and ready to support your transition, and you can read our detailed guide or contact us if you have questions about Corporate Tax or e-invoicing in spain.

FAQ

What is the standard Corporate Tax rate in Spain?

25% is the general rate for most companies.

Who must pay Corporate Tax in Spain?

Resident companies and non-residents with a permanent establishment.

What are the Corporate Tax forms?

• Form 200 – Standard annual return
• Form 220 – For consolidated groups
• Form 232 – For related-party or tax haven transactions
• Form 202 – For advance payments

 How do I pay Corporate Tax?

You must pay online through the Spanish Tax Agency using:

• Direct debit
• Credit/debit card
• Bank transfer
• BIZUM

Do startups get any tax benefits?

Yes, newly created entities and eligible startups pay 15% for the first 2 profitable years.