The choice of the best form of taxation is a right recognized by the courts

[jrineakter01]

Without going into cases such as Messi's, and others in which the chosen form of taxation consists of avoiding taxation by using companies located in tax havens, the choice of legal form is a right of taxpayers , subject to certain self-imposed limits by the taxpayer, depending on the capital contributed and the responsibility that one is willing to assume, and imposed by current tax regulations that limit the form of taxation of certain activities.

When a business owner starts a business alone, he can choose between different alternatives, depending on which he will pay income tax or corporate tax . The options that can be chosen are the following:

Individual Entrepreneur (Self-Employed), where there is no minimum legal capital, but the partner's liability covers all of his/her assets.
Limited Liability Entrepreneur , where the entrepreneur's liability is unlimited with some exceptions and where there is no legal minimum capital.
Public limited company , with the necessary qatar email list capital being 60,000 euros and liability limited to the capital contributed to the company.
Limited Company of Successive Formation , with liability limited to the capital contributed, without there being a legal minimum.
New Company Limited Company , with a minimum capital of 3,000 euros and a maximum of 120,000 euros, and liability limited to the capital contributed to the new company.
Professional Companies , the capital depending on the corporate form adopted, with liability limited to the capital contributed.
Limited Liability Company , with a minimum capital of 3,000 euros and limited liability to the capital contributed.
Tax control and tax violations of professional companies of celebrities




The corporate forms of professionals, artists and elite athletes have been in the focus of the Tax Agency since the Tax Control Plan of 2012 included them as priority areas of investigation, considering that they use companies to improperly deduct, through them, their personal expenses. In the Tax Control Plan of 2015, it is indicated that the improper use of companies to reduce the taxation of individuals will continue to be subject to special control.

According to the latest tax control plan, in the last year the planned actions on professional activities increased by 14.7%, with the aim of detecting the abusive use of companies in business activities in their relations with partners, employees, directors or related persons.

These types of companies are created because the nominal rate applied when receiving a salary through a company can be more than 20% lower than if the Income Tax scale is applied at marginal rates, which until this year amounted to 52%, and reached 56% in autonomous regions such as Catalonia or Andalusia (47% and 49% respectively since January 1). This percentage difference, in the case of high salaries, can mean hundreds of thousands of euros of tax savings.

Some violations in the incorporation of companies based in Spain , both by famous people and those that can be extrapolated to other sectors, are:

The simulation of an activity , when the company does not have effective means and only serves to defraud.
Related-party transactions below market price , i.e. transactions between the business owner or professional and the company that do not conform to the market price, charging less than what would be invoiced to another company without a link. In these cases, the Treasury understands that the company is used to divert remuneration that would be taxed under personal income tax and not corporate tax.