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Tax relief on Spanish charity donations

By Chris Burke - Topics: Barcelona, spain, Tax Relief
This article is published on: 19th March 2018

When you pay Spanish income tax while residing in Spain, you can qualify for tax relief on any charity donations that you make (to certain types of charities such as foundations or NGO’s, i.e. non profit making organisations.

The tax relief you can receive here in Spain, whether you are employed, self employed or have a Spanish S.L. (company) are as follows:

For individuals & self employed (autonomo)

Amount paid in charity donation,
up to per year
Percentage deduction (%)
150euro 75%
Amount paid above 150euro 30% (or 35*)

 

* If the amount paid in each of the two previous years is the same or more than the amount paid the previous year of each of these two years, the percentage increases to 35%.

The amount deductable cannot exceed 10% of the taxable income of the year.

For companies

Tax relief is 35% unless the amount paid in each the two previous years is equal or more than the amount paid the previous year of each of these two years, in which case the percentage increases to 40%.

The amount deductable in a year cannot exceed 10% of the taxable income of that year. If it does, you can apply the excess during the 10 following years.

In each of the above cases, the deduction is taken from the amount of tax to be paid.

People are much more responsive to charitable pleas that feature a single, identifiable beneficiary than they are to statistical information about the scale of the problem being faced. In essence, we are ruled by our hearts, not our heads when donating and showing the proven effectiveness of the charity can actually have the opposite effect to that intended. Take the time to research your chosen charity to make sure your money is going to be doing what you want it to do.

Although many people would like to leave a gift to charity in their will, they often forget about it when they write their will. Research has shown that if the will-writer just asks someone if they would like to donate, the rate of donation roughly doubles. Remember to make a list of any charities you would like to contribute to, before you sit down to write your will.

Giving to charity is contagious, seeing others give makes an individual more likely to give themselves and gentle encouragement from a prominent person in your life can make also make a big difference to your donation decisions. Most people support charities in one way or another, but often struggle to make donations as often as they think they should or would like to.

If you would like to donate to charity more but it slips to the back of your mind, create a habit. For example, every time you receive a bonus or every time you get paid you could make a donation, or if it is the birthday of someone close to you, send them a birthday wish and give a little to charity. Spending money on others actually makes us happier than spending it on ourselves!

Source GM Tax consultancy, Barcelona.

Article by Chris Burke

Chris BurkeIf you are based in the Barcelona/Costa Brava area you can contact Chris at: chris.burke@spectrum-ifa.com for more information. If you are based in another area within Europe, please complete the form below and we will put a local adviser in touch with you.

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