A foreign company can create a taxable presence in Spain without opening anything. A contractor who negotiates, a country manager who closes, stock held for local delivery, a director who decides from Madrid — each of these has been enough. Five questions below will tell you whether this is worth looking at properly.
Five questions about how you actually operate. No email, nothing stored, nothing sent anywhere. It will not tell you whether you have a permanent establishment — nothing can do that without the documents — but it will tell you whether the question is worth asking.
Permanent establishment is an old concept that has been quietly re-cut over the last few years, at the same time as companies started hiring people who live wherever they like. Most exposure we see was created by ordinary commercial decisions taken by people who had no reason to think they were tax decisions.
Almost everyone who comes to us is worried about PE. It is usually the smaller of the two exposures sitting in the same set of facts, and the one that gets attention because it has a familiar name.
The chart describes what was intended. These describe what happened, and they are what an inspector reads. Most of them already exist inside your business; assembling them is a large part of the work.
We price the review separately and deliberately, because it has to be possible for the answer to be that you need nothing. When the answer is that you do, these are the two routes it normally takes.
No, and anyone who does is guessing. The answer turns on facts that take assembling — who negotiated, what the contractor's other clients look like, where the stock sat, what the board actually decided and where. A call can tell you whether the question is worth asking, and we are happy to have that call for nothing. It cannot tell you the answer.
That is the risk of asking, and it is real. It is also smaller than the alternative: voluntary regularisation before an enquiry carries materially lower surcharges than correction after one, and exposure that is found rather than declared tends to surface at the worst possible moment, typically during due diligence on a sale or a funding round. The review is covered by professional confidentiality; what you do with it is your decision, not ours.
They may well be right, and if they are the review is cheap insurance. What they usually cannot do is apply the Spanish domestic residence test, or read the Spanish-language administrative and judicial practice on how your particular convention has been interpreted here. The question is not whether your adviser is good. It is whether the analysis was done from the Spanish side as well as yours.
Spanish tax years remain open for a limited period, so exposure is bounded but it is not bounded at one year. Each year that passes adds a year of potential attribution and removes the option of voluntary disclosure on favourable terms for the oldest one. There is no emergency, but there is a cost to waiting.
We give a range with the assumptions stated, which is what an auditor can work with. A single figure would imply a precision that attribution analysis does not have. If your auditor needs something more formal we will speak to them directly.
The analysis is Spanish-side, so the answer is generally yes, whatever the other country is. Where the convention is unusual we say so at intake rather than after. We have written publicly on the Indian, US, UK and French conventions, and the Indian one in particular departs from the model in three separate ways.