AS
Bufete de abogados penalistas Alonso Sala
publicPractice Area

International Taxation & Crime

Specialized defense in offshore structures, transfer pricing, and residency conflicts. Legality vs. Simulation.

arrow_backBack to Tax Hub

Economic Substance: The Antidote to Simulation

In modern international taxation (post-BEPS), the key is no longer where the company is incorporated, but where it adds value. The Tax Agency systematically attacks foreign structures (Holdings in the Netherlands, Trading in Ireland, IP in Luxembourg) claiming they are "shell companies" or mere artifices without economic substance created to erode the Spanish tax base.

Our criminal defense focuses on proving Economic Substance and Effective Management. It is not enough to have a registered office in Dublin; one must prove that strategic decisions are made there ("Board meetings"), that there is qualified personnel hired at source, real offices, and business risks assumed. If we demonstrate that the structure has real economic life, we dismantle the accusation of simulation and fraudulent intent.

Transfer Pricing: Crime or Valuation?

International related-party transactions are a constant focus of conflict. The Prosecution accuses of tax crime when a Spanish company sells services or goods to its foreign parent (or vice versa) at a price it considers "manipulated" to shift profits to a lower-tax jurisdiction.

Technical Valuation Defense

We defend that valuation discrepancies in transfer pricing are complex technical issues, subject to interpretable market ranges and valuation methods (CUP, Cost Plus, TNMM), and not crimes. We provide "Master Files" and "Benchmarking" studies to justify that the group's pricing policy is reasonable and in accordance with OECD guidelines, eliminating criminal intent.

Tax Residency Conflicts

We defend large estates, artists, and athletes accused of simulating their residence abroad. The AEAT uses invasive means of proof (geolocation, cards, consumption).

Our strategy consists of providing solid proof of effective life outside Spain (consular certificates, rental contracts, children's schooling, membership in social clubs abroad) and attacking the validity of Treasury's circumstantial evidence (sporadic presence days vs. effective residence), invoking Double Taxation Treaties to break tie-breaker rules in favor of the client.

public

Why Alonso & Sala for International Taxation?

Specialized defense in offshore structures, transfer pricing, and residency conflicts. Mastery of BEPS and AEAT Big Data.

  • languageExperience defending economic substance (BEPS - Effective Management).
  • languageNetwork of transfer pricing experts (Master Files, OECD Benchmarking).
  • languageAnti-Big Data strategies: geolocation countermeasures, consumption, CRS.
  • languageDouble Taxation Treaty litigation (tie-breaker rules).
quiz

FAQs

Is it a crime to have a company in Panama?expand_more
No, absolutely not. Having an offshore company, a Swiss account, or assets abroad is perfectly legal as long as they are declared to the Spanish Treasury (Form 720, Wealth Tax, IRPF). The crime is not having money abroad, but hiding it and not paying taxes on the income it generates. Opacity is the problem, not internationalization.
What is tax residency simulation?expand_more
It is pretending that you live in another country (e.g., Andorra, Portugal, UK) to avoid paying IRPF in Spain, when in reality you spend more than 183 days here or have your center of vital interests here. It is the number one cause of tax crime in large estates, artists, and athletes. The Treasury monitors electricity consumption, cards, schools, and geolocation to prove effective presence.
How does the Treasury know if I live here?expand_more
The AEAT has a 'Big Data' unit that crosses thousands of data points: utility consumption (electricity, water) to see if the house is inhabited, credit card movements, cash withdrawals, mobile geolocation (via court order in criminal cases), social networks (photos in Spain), medical visits, and children's schools. If 'life' is in Spain, you are a resident.
What is transfer pricing crime?expand_more
It consists of manipulating prices in transactions between companies of the same group (one in Spain and another in a low-tax country) to artificially shift profit where less tax is paid. If invoicing is below market to leave profit out, and tax savings exceed €120,000, it is a crime.
What if I didn't file Form 720?expand_more
Although the brutal 150% fines were annulled by the CJEU, not filing the 720 is still dangerous. If the Treasury discovers undeclared assets, it will impute an 'unjustified capital gain' in the IRPF of the last unprescribed year. This can skyrocket the quota to be paid and generate a tax crime if it exceeds €120,000.
Can I be investigated for accounts in Switzerland?expand_more
Yes. Swiss banking secrecy no longer exists for the Treasury. The Automatic Exchange of Information (CRS) system allows the AEAT to receive annual balance and account data of Spanish residents in almost any country in the world. Transparency is almost total.
What is a 'holding' structure?expand_more
It is a parent company that owns shares of other companies. It is a legal and efficient tax planning tool. However, the Treasury attacks these structures when the holding is a mere empty shell (no employees, no office, no effective management) created only to deduct expenses or take advantage of dividend exemption improperly.
Can I regularize 'offshore' money?expand_more
Yes, through voluntary supplementary declarations (Art. 305.4 CP). But beware: you must prove the lawful origin of the money to avoid a parallel accusation of money laundering. Tax regularization does not 'clean' criminal origin (e.g., if the money comes from drug trafficking).
What are Controlled Foreign Corporation (CFC) rules?expand_more
It is an anti-avoidance regime that requires including passive income (interest, dividends, rents) obtained by your companies in tax havens in your Spanish IRPF declaration, even if you haven't distributed the money. Omitting this imputation is a common form of fraud.
What if I am a 'digital nomad'?expand_more
If you don't spend 183 days in any country ('perpetual tourist'), the Treasury will try to catch you by the 'main core of economic interests' criterion. If your clients, income, and assets come from Spain, they will say you are a tax resident here even if you travel a lot. It is a growing litigation area.
What about Youtubers in Andorra?expand_more
The case is the same. If they spend more than 183 days there, it is legal. But if they come down to Spain every weekend, spend holidays here and add days, or if their 'main core' of activity is considered in Spain, they risk inspection. The burden of proof of effective residence in the tax haven lies with the taxpayer.
Is prescription different if there are foreign elements?expand_more
Yes. When tax havens, complex international schemes, or interposed persons are used to hide identity, the aggravated type of tax crime applies (Art. 305 bis), whose prescription extends to 10 years (instead of the usual 5).

Need Immediate and Expert Legal Assistance?

The judicial system is complex and can be relentless. Do not face it alone. We have the experience, technical knowledge, and human resources necessary to fight for you. Contact us today to schedule a confidential consultation and start building your defense.

Contact Alonso Sala

We use cookies to improve your experience. By continuing to browse, you accept our privacy policy.