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Thumb through any publication on overseas property and lifestyle and you’ll receive the same guidance time and time again – take expert advice before making life-changing decisions like buying a property or setting up a business in a foreign land. Choose the right estate agent, consult a lawyer, listen to the professionals. However, one breed of professional, the accountant, seems to lag behind on column inches. An oversight really as when it comes to setting up and running a business abroad, your choice of accountant could mean the difference between a peaceful nights’ sleep and a restless one. Get your books in a mess and rest assured that Señor Spanish Taxman will have a field day.

Alfonso Rivera Revilla, Director of Accounting Network based in Marbella, comments, “Financial affairs in Spain are very complex and handled in a different way to those in the UK. Some new foreign business owners employ a cheap bookkeeper who barely speaks English and does the minimum to ensure tax payments are made but doesn’t give you useful information to help you manage your business better. To the other extreme, some employ an expensive Chartered Accountant who in the UK may be the bee’s knees, but in Spain is superfluous as they cannot read Spanish law to keep up to date with tax regulations. The best advice is to choose an English-speaking Spanish Accountant who knows the tax rules and how to handle them in the best manner to enhance your business.”

Mistakes in Spain can be very costly; the taxman is unsympathetic to bending or breaking of rules and can impose hefty fines. Alfonso continues, “Some people turn to Accounting Network having paid the price for failing to keep their finances in order. In one case a Swedish subsidiary was importing goods to a Spanish subsidiary and the Spanish division had omitted to file an intracommunity tax declaration. When this was brought to the attention of the Spanish Tax Office, they demanded a huge payment of 120,000 euros. Had the declaration been made, no tax would have been payable. An expensive oversight. Another common problem is people attempting to make their own expense claims without being in possession of proper invoices. A delivery note showing the balance payable and the IVA (VAT) is not an acceptable document; only a formal invoice with fiscal details is adequate to account for a deducted expense. In one instance an individual was fined 15% of the amounts he had incorrectly claimed as expenses, damages which totaled 11,000 euros.”

So before you even think about opening the doors to your new shop or restaurant, make sure your financial affairs are, and will always be, in a shipshape and orderly fashion. Attempt to tackle your books alone at your peril.

For advice on accountancy, company incorporation, property conveyancing and other fiscal matters, please email info@accountingnetworksl.com or visit www.accountingnetworksl.com