Reducing the tax burden of an SME in a legal way is not only possible, but should be part of the financial and strategic planning of any business. At Gutiérrez Pujadas & Partners, we advise SMEs from all sectors on how to optimise their taxation in accordance with current regulations, without taking unnecessary risks.
In this article, we explain how to legally reduce taxes in an SME, through effective and transparent tax strategies adapted to the economic reality of each company.
1. The importance of continuous tax planning
Many SMEs only think about taxes when it comes to filing their corporate income tax or VAT returns. However, the key is to anticipate: proper tax planning allows you to make decisions with a positive impact before taxes are accrued.
This involves:
- Reviewing the cost and profit structure.
- Applying deductions and rebates from the start of the financial year.
- Optimising investments, remuneration and provisions.
Proactive tax management is more effective than any last-minute corrective action.
2. Accelerated depreciation and freedom of amortisation
One of the most powerful tools for reducing the corporate tax base is accounting depreciation.
There are two key mechanisms:
a) Accelerated depreciation
This allows certain assets to be depreciated at a faster rate than usual. This generates a higher accounting expense in the early years, which reduces the tax benefit and, therefore, the tax payable.
It is permitted for:
- Low-value assets (up to €300 per unit and €25,000 per year).
- Fixed assets related to innovative activities.
- Assets acquired under a financial leasing arrangement.
b) Freedom of amortisation
Companies that apply the regime for small companies (turnover less than 10 million euros) can apply freedom of amortisation in certain cases, such as:
- Investments in new assets.
- Increase in the workforce.
This tool allows certain assets to be fully amortised in the same financial year in which they are acquired, generating an immediate tax effect.
3. Corporate tax deductions
Corporate tax allows tax deductions for specific activities. They are a direct way to reduce the total tax liability.
The most common are
- Deduction for R+D+i: for expenditure on research, development and technological innovation. This is one of the most powerful, and in some cases even allows for the monetisation of (direct collection of) the tax credit.
- Deduction for environmental investments.
- Deduction for job creation.
- Deduction for professional training.
It is essential to document these deductions properly and to seek specialised advice, as their application must be justified to the tax authorities in the event of an inspection.
4. Review of the remuneration model for the managing partner
In many SMEs, the managing partner also works in the company and receives remuneration. This aspect, if structured correctly, can have important tax implications for both the company and the partner.
Some possible strategies:
- Divide the remuneration between salary and dividend.
- Consider the option of professional companies in technical or liberal activities.
- Optimise Social Security contributions according to the applicable regime (self-employed or general regime).
In addition, it is essential that the remuneration is correctly approved in the statutes or through board agreements, so that it is deductible.
5. Deferrals and instalments of taxes
In specific situations of cash flow tension, SMEs can resort to legal mechanisms to defer or split the payment of taxes. This does not reduce the debt, but allows it to be adapted to the cash flow of the business.
The Tax Agency allows deferral of:
- VAT (in certain cases).
- Withholdings and payments on account (with limitations).
- Corporate Tax.
- Partial payments.
It is essential to meet deadlines and not accumulate unpaid debts to avoid surcharges, interest or loss of good taxpayer status.
6. Creation of holding companies or holding structures
In some situations, it may be advisable to separate assets (real estate, machinery, brands, etc.) from the main activity. This is achieved by creating a holding company or a holding company structure.
The advantages may be:
- Protection of assets against operational risks.
- Optimisation of taxation on the transfer of assets.
- Application of special regimes such as that of group companies or exemption for internal double taxation.
However, this type of structure must be planned with expert advice and with a clear economic justification to avoid conflicts with the tax authorities.
7. Optimisation of flexible remuneration and social benefits
The use of flexible remuneration systems allows workers (including partners) to receive part of their salary in kind, with tax advantages for both the company and the employee.
Some common options:
- Restaurant vouchers.
- Private medical insurance.
- Childcare.
- Training.
- Transport.
The company can deduct these expenses, and in many cases the worker does not pay tax on them or pays tax at a reduced rate. This strategy also improves team motivation and loyalty.
8. Offsetting negative tax bases
If in previous years the SME has had tax losses, these can be offset against future profits, thus reducing the tax base. Since the 2015 tax reform, there is no time limit for applying these offsets, although there are quantitative limitations depending on the result.
This aspect should be considered in accounting and annual tax planning.
9. Choosing the right tax regime
In the case of new companies or small businesses, the choice between different legal forms (self-employed, limited company, community of goods, etc.) or VAT regimes (general, simplified, equivalence surcharge) can lead to significant tax differences.
At Gutiérrez Pujadas & Partners, we carry out a preliminary analysis to recommend the most appropriate legal and tax structure from the outset, which saves a lot of costs in the future.
10. Professional and ongoing tax advice
Finally, the best strategy for legally paying less tax is to have an expert tax team that knows your business inside out. It is not a question of applying generic formulas, but of building a personalised tax strategy, aligned with the evolution of the business, the legal environment and the objectives of the SME.
Conclusion
Reducing taxes in an SME is entirely possible if the right tax strategies are applied. From accelerated amortisations to flexible remuneration, including corporate structures and tax deductions, the tools are there. The key is to have continuous and expert advice.
At Gutiérrez Pujadas & Partners we help SMEs comply with their tax obligations without paying more than necessary. If you want to review your tax strategy or start planning ahead for the next financial year, contact our team.