The vast majority of companies are classed as small companies. Our office specialises in the special legal scheme for these organisations so that we can offer solutions and advice to your company. We will keep you informed of all available tax benefits under this special scheme.
Small companies have a net turnover in the previous tax period of below 10 million euros, whatever the turnover in the current tax period may be. The definition of the concept of “net turnover” is taken from commercial regulations -accounting, more specifically- and is determined by deducting from the number of sales of products and the provision of services or income corresponding to the company’s ordinary activities, the amount of any returns and discounts -more specifically, (i) the amounts of sales returns, (ii) rebates on sales or the provision of services; (iii) commercial discounts made on the income included in the annual turnover- and that of VAT and other taxes directly related to the company’s ordinary activities; (ii) rebates on sales or supplies of services; (iii) trade discounts on revenue included in the annual turnover; and the amount of VAT and other directly related taxes to be passed on.
However, tax incentives for small businesses do not apply to those companies in which more than half of the assets consist of securities or are not affected by economic activity according to the Corporation Tax Act.
Tax incentives for these companies apply in the three immediate tax periods and after that tax period in which the entity – or set of entities, if there is a group of companies – reach the turnover mentioned above of 10 million euros, provided that they have fulfilled the conditions to be deemed “small” in the current and the two preceding tax periods.
These companies are subject to a special scheme in the Corporate Income Tax and can apply several tax incentives to optimise their tax position. Our tax department has experience in the tax advice and management of these types of companies. We are ready to provide high-quality advice that will help you to reduce your tax bill.