Proposed Tax changes for 2024

Armando Benito of CostaGestion gives a round up of the proposed changes in tax liabilities for 2024

Tax changes for individuals 2024

Increase of the minimum to pay taxes in the IRPF (Annual Tax Return)

If your work income is below 15,000 euros will not be required to file the Income Tax return. (Not applicable to self-employed)

Wealth tax returns to Andalucia and Madrid

The application of the Temporary Solidarity Tax on Large Fortunes (Assets over 3 million euros) is extended.

Madrid and Andalusian taxpayers will have to pay the Wealth Tax (taxes fortunes above two million) from 2024 after the regional governments reactivate it.

Income tax declaration for self-employed workers

All self-employed workers will have to file an income tax return.

Previously, only those self-employed workers who had obtained net income from economic activities/real estate income above 1,000 euros per year had to file a return.

Modules (Módulos)

The Ministry of Finance has eliminated for the new year the extraordinary reduction of 10% in the IRPF for self-employed workers who pay taxes by the objective estimation system, also known as the module system.

Sales on “online” platforms

From next year Digital platforms will have to report to the Tax Agency on the sales operations that professionals or individuals make through them, for example, on Amazon, Wallapop, or Vinted, when sales exceed 30 per year or 2,000 euros in value.

VAT franchise regime for self-employed workers (To be approved)

In relation to self-employed workers, the Tax Agency wants to implement during 2024, the so-called “VAT franchise regime”, through which self- employed workers who invoice less than 85,000 euros per year will be exempt from including VAT in their invoices. That is, this franchise regime would allow them to develop an economic activity without applying VAT, as long as the minimum business threshold is not reached (it is likely to be 85,000 euros).

This is not an initiative proposed by the Spanish Treasury, but rather a European premise that must be complied with by the EU Member States.

New tax deductions

Electric cars

When you buy an electric car in Spain, you can claim a tax deduction on your IRPF (Annual return). This deduction is 15% of the purchase value of the vehicle, applicable if you buy it between June 30, 2023 and December 31, 2024, among other requirements. Deduction limit: 3000 euros. The car must not be for economic activity.

The deduction is also applicable to the installation of a charging point. 15% deduction with a limit of 4000€.

Larger Companies

Minimum tax of 15% for multinationals

From 2024, multinationals (those with presence in two or more countries) and large groups (with presence only in Spain) that have a turnover equal to or greater than 750 million per year, together with their subsidiaries, whether they are in our country or abroad, will have to assume a minimum taxation of 15%.

CONSTRUCTION SECTOR

Pension plan in the Construction sector

Contributions to workers’ retirement will be provided by the company.
From February 1, all self-employed workers with employees and small businesses in the Construction sector will have to contribute to a pension plan for their employees. According to some studies, it will increase spending by about 20 euros per month per worker.

Information provided by CostaGestion.com and correct as of January 31, 2024