Germany is a Major Direct Investor in Spain

According to figures provided by Deutsche Bundesbank, approximately 1,200 German companies have established subsidiaries or holdings in Spain. The majority of these companies also own their production facilities in Spain.

German Tourism in Spain

It is estimated that in 2015, Spain was visited by 10.3 million Germans. This made Germans the third largest group of tourists, after the British and the French.

German Exports to Spain

German exports to Spain totaled $45 billion.

Product Total Value
Vehicles $12 billion
Machinery $7.5 billion
Electronic Equipment $3.8 billion
Plastics $2.3 billion
Pharmaceuticals $1.9 billion
Medical, Technical Equipment $1.9 billion
Organic Chemicals $1.4 billion
Iron and Steel $1.1 billion
Other Chemical Goods $1.1 billion
Iron and Steel Products $716.7 million

Spanish export Germany

Germany exports to Spain totaled $43 billion or 3.2%.

Product Total Value
Vehicles $9.3 billion
Machinery $7.8 billion
Electronic Equipment $4.3 billion
Plastics $2.2 billion
Pharmaceuticals $1.9 billion
Medical, Technical Equipment $1.9 billion
Organic Chemicals $1.1 billion
Iron and Steel $916.4 million
Aircraft, spacecraft $903.4 million
Other Chemical Goods $798.7 million

Spain and Germany Double Taxation Agreement

On 03/02/2011 the 2011 Tax Convention was signed.

Its provisions have been in effect since 01/01/2013.

The agreement provides lower tax rates for dividends as follows:

  • 5% of the gross amount of the dividends if the owner is a company
  • 15% of the gross amount in all other cases

Royalties including payment for using, or the right to use, industrial, commercial and scientific equipment can only be taxed in the recipient's country of residence.

According to the new Tax Convention, the gains that derive from the disposal of shares can be taxed in the transferor's country of residence, even though some particular exceptions are provided.

Finally, the Tax Convention provides, as far as the limitation of benefits are concerned, that both Spain and Germany are entitled to apply their domestic anti-abuse provisions and their domestic controlled foreign company rules.

Tax conventions benefits are not applicable to non-beneficial owners and competent authorities are entitled to agree on a procedure to avoid double taxation.

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