Germany and Spain double taxation treaty

The original Germany and Spain double taxation treaty was put in place in 1966, but has recently been amended.

 In 2011, in Madrid, Germany and Spain re-did the double taxation agreement making more suitable conditions and functionality between the two states.
 
Of course the new treaty places the old new and has several adjustments, which anyone between the two countries should become aware of and keep themselves up to date as they are the only ones who will benefit from the information. If you were not aware that changes had been made, then this could possibly end up costing you money either in the short or long run, because your declaration and taxes may be wrong. 
 
The new treaty aims to reduce the pre-paid retention percentage for certain taxes, this means that less money is going to held at the source.  The most significant change, on the new treaty will have to with capital gains tax. The basic concept is that the tax will be enforced where ever the property is, so if someone from Germany wanted to invest in Spain, they would be subject to the taxes in Spain and not in Germany. Another change is that Germans, who are employed in Spain, may have the opportunity to not be taxed as a resident, in some cases.  In terms of pensions, some will be subject to taxation in Spain and others will be subject to taxation at source. What this means is that previously pensions were to be taxed in the country of residency, where as now it will depend on where the pension comes from as to whether it is to be taxes in Spain or not. 
 
These are general guidelines for taxation between countries and you should always consult the corresponding tax offices and a professional solicitor and accountant to avoid any misunderstandings or mistakes. 
 
ABAD LEGAL and FINANCIAL firm would be more than happy to inform and assist you with inter-country taxation.
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