Does your company send its workers to work occasionally or with a certain frequency abroad? Are you aware that your Income Tax can be reduced? Is it a problem for the company to manage the documentation and know exactly what exemption should be applied to their payroll and that of other workers who perform work abroad? In that case we can help you.
How can we help you?
As you surely know, there is a rule that rewards employees for the “annoyances” that work trips entail and that, at the same time, aims to help the internationalization of Spanish companies, as well as facilitate the hiring of the best talents by the company.
This rule allows to declare as exempt in the Personal Income Tax the return received from work actually carried out abroad, with a limit of 60,100 euros per year, which can mean significant tax savings for those employees of Spanish companies who regularly travel abroad to develop their work.
Importance of correctly managing the requirements and documentation necessary to apply for the exemption
This exemption can be very beneficial for certain taxpayers, but it is a rule whose application has caused – and still causes – differences between the Tax Administration and taxpayers. This may cause the loss of the right to exemption, with the consequent obligation to enter Personal Income Tax quotas that have not been paid, as well as the extra charges and penalties that may correspond, both to the employee and the company, for an incorrect withholding of remuneration satisfied to the worker.
These differences occur as the Tax Administration consider the necessary requirements not accredited to have the right to obtain this tax benefit. Thus, it is extremely important that the management in compliance with these requirements and the documentary accreditation of theme is perfectly worked by the company and the worker.
In order to avoid this type of problem with the Tax Administration, Addwill has a tool that makes it easier for companies to control their employees trips, so that those responsible for Human Resources do not have to worry about carrying out an analysis on the fulfillment of the legal requirements to be able to reduce, not only the final Personal Income Tax, but even the withholdings to be practiced, so that there are no discrepancies between what is declared by the company and by the employee.
What is TravelTracker?
TravelTracker is an online tool that allows accurate and safe monitoring of the trips abroad made by employees for the purposes of applying the exemption for work provided abroad contained in article 7.p of Law 35/2006, of November 28, of the Personal Income Tax.
What is TravelTracker for?
With this tool, your company will be able to store the documentation and information justifying the trips abroad, with the aim of determining the amount of the gross annual salary provided that the workers comply with the legally established requirements.
How TravelTracker works
Through the online platform, you will provide Addwill with data related to workers’ trips to determine the exemptions for each of them.
Through an email, your company will be provided with the link to TravelTracker-addwill along with your username and password.
Once the user is set in the program, the company can begin to create the trip reports and review those that are pending approval by the Addwill team. The program also allows to detect if it is necessary to provide additional documentation.
Advantages of TravelTracker
This program has great advantages, by avoiding the problems that the application of the rule raises and being able to overcome the differences that may arise on the part of the Tax Administration with the taxpayers.
The program has technical-legal support from a team of lawyers and economists specializing in tax advice, who will resolve any questions about specific circumstances that may arise when applying the exemption.
Thus, a control is achieved at all times of the necessary documentation to be able to apply the exemption in Personal Income Tax for work carried out abroad, ensuring that the company practices tax withholdings correctly and preventing the company and employees show inconsistencies in their respective statements.
If you are interested in knowing our documentary tracking software first-hand, you can contact us without obligation to obtain more information about this product.