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Spain and Portugal, priority countries among capital destinations

| News | Tax

Andersen in Spain and Andersen in Portugal organised the webinar "Investment opportunities in Iberia: tax advantages and landing planning in Spain and Portugal" to provide an overview of the main advantages, opportunities and incentives for investments in both countries

The flow of investment between countries is becoming greater, more frequent and, therefore, more complex. In this context, and especially in recent years, Spain and Portugal have become two attractive territories for high-net-worth individuals, offering a wide range of tax advantages and special regimes for individuals and companies interested in developing their investments in either territory.

In order to ensure the best results for these investments, Andersen in Spain and Andersen in Portugal presented the seminar "Investment opportunities in Iberia: tax advantages and landing planning in Spain and Portugal", in which professionals from the Spanish and Portuguese markets Borja de Gabriel, Andersen partner in Spain, and Gonçalo Cid, Andersen partner in Portugal, analysed the key factors and incentives offered in both countries when making an investment, in order to minimise risks and maximise profits. Both professionals offer specific advice to individuals, family offices, companies, international family groups, for their investments in Spain and Portugal and their internationalisation processes.

Ignacio Aparicio, Andersen partner in Spain, introduced the event and the speakers, explaining that the purpose of this type of seminar "responds to the high demand that exists to learn more about the tax regimes in Spain and Portugal, which may be more beneficial or less volatile than those that exist elsewhere". Andersen has previously held other seminars, in collaboration with territories such as Venezuela and Mexico, to explain the best investment opportunities in these countries.

To know how to act when arriving in Spain and Portugal in order to carry out an investment, it is essential to know the different taxes that exist in both countries. Among the various taxes to be considered, in addition to the tax residency requirement and personal income tax, the Wealth Tax is where one of the main differences with Portugal is to be found. "The best place to reside in relation to this tax is Madrid, as it has a 100% exemption, but there are other cases such as Valencia or Barcelona, where the tax is around 3%, so we advise you to land in Madrid," explained Borja de Gabriel. The same applies to Inheritance and Gift Tax, "again, Madrid is the territory with 99% relief, so it is advisable to enter from here" he concluded.

According to Gonçalo Cid, "in the case of Portugal, there is no wealth tax, so it is highly advisable to make investments in the country".

Regarding tax obligations, there are other figures to be taken into account, such as the reporting of assets held abroad. Both countries have special regimes:

The Beckham Law in Spain - which allows taxation in Spain only on Spanish income and not on income obtained abroad (except for earned income), and a flat tax rate of 24% (above the first €600,000) on earned income -, or the Golden Visa for obtaining a residence permit, which is also available in Portugal.

There are also special characteristics in the case of deciding to establish the head of business groups in Iberia, and in both Spain and Portugal there is a 95% (Spain) and 100% (Portugal) participation exemption regime. Spanish legislation also offers the Spanish ETVE or holding company regime, which allows profits to be repatriated to Spain at no tax cost, taking advantage of the benefits of the many agreements signed by Spain and, more importantly, distributing these profits to the ETVE's non-resident partners abroad without any tax impact.

All these elements provide an overall picture of the tax landscape to be considered when investing, assessing which are the most beneficial elements for each particular case, depending on whether you are an individual investor, family office, company... 

"Iberia is a good place to invest in Europe, we have many benefits, very good and interesting regimes, both countries have the Euro as their currency, so we invite you to learn more about their situation" concluded Gonçalo Cid.

Borja de Gabriel, for his part, said that "in the last two years we have noticed a lot of movement from South America. Currently, in the last two fiscal years, the political situation in some parts of Latin America has caused many movements to Europe, especially to Spain and Portugal". He concluded that in Iberia "we have a lot of attractions, and we hope that they will be considered as options for investment".

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