ES Modelo 111

Conservative Defaults

| Ambiguity | Default | |---|---| | Unknown whether professional qualifies for 7% | Apply 15% (standard rate) | | Unknown whether payer must withhold | If payer is a business/professional making payment to another professional for services -- must withhold | | Unknown whether to file negative Modelo 111 | File with zero amount (declaración negativa) if registered but no payments in quarter |

2.1 Entities That Must Withhold

| Payer Type | Must Withhold? | |---|---| | Sociedades (SL, SA) | Yes -- always | | Autónomos / professionals (individual) | Yes -- when paying other professionals for services | | Public administration | Yes | | Comunidades de propietarios (if paying professionals) | Yes | | Individuals (not in economic activity) paying professionals | NO -- private individuals do not withhold | | Foreign entities without permanent establishment in Spain | Generally NO (unless PE exists) |

2.2 Payments Subject to Withholding

| Payment Type | Withholding? | Rate | |---|---|---| | Invoice from professional autónomo (abogado, consultor, diseñador, etc.) | Yes | 15% (or 7% if new) | | Invoice from SL/SA (company) | NO -- companies do not have retenciones on services (they pay Impuesto de Sociedades) | | | Invoice for goods (not services) | NO | | | Invoice from agricultural module regime | Yes | 2% (or 1%) | | Board member fees (administrador) | Yes | 35% (or 19%) | | Salary to employees | Yes | Variable IRPF rate per employee (calculated per tables) |

3.1 Conditions for 7% Rate

| Condition | Requirement | |---|---| | First activity | Professional has not been in an economic activity in the prior year | | Time limit | Applies during the tax year of commencement + following 2 tax years (3 years total) | | Communication | Professional must communicate in writing to the payer that they qualify for 7% | | Verification | Payer is entitled to rely on the professional's written communication |

4.1 Form Structure

| Section | Content | |---|---| | Sección A | Identification (NIF, name, period) | | Sección B | Rendimientos del trabajo (employee salaries) | | Sección C | Rendimientos de actividades profesionales | | Sección D | Premios (prizes) | | Sección E | Ganancias patrimoniales (forest exploitation) | | Sección F | Imputaciones de renta (certain income attributions) | | Total | Sum of all retenciones to deposit |

4.2 Section C Detail (Professional Services)

| Field | Content | |---|---| | Number of recipients (perceptores) | Count of distinct professionals paid in the quarter | | Base of withholdings (base de retenciones) | Total value of professional invoices (base imponible, not including IVA) | | Retenciones (amounts withheld) | Total retenciones withheld (base × rate) | | Ingresos a cuenta | Amounts paid on behalf where retención not possible (less common) |

4.3 Filing Method

| Method | Detail | |---|---| | Electronic (certificado digital) | Most common; mandatory for SLs and larger entities | | Electronic (Cl@ve PIN) | Available for autónomos and individuals | | Paper | Only for specific cases (pre-printed forms) | | Negative declaration | Must file even if no payments made (declaración negativa) if registered as retenedor |

4.4 Payment

| Method | Detail | |---|---| | Direct debit (domiciliación) | Must file by 15th of month (5 days before deadline) | | NRC (electronic bank payment) | Available up to last day | | Bank in person | With payment letter from AEAT |

5.2 Content per Recipient

| Field | Detail | |---|---| | NIF of recipient | Professional's tax ID | | Name | Full name or company name | | Province code | Province of recipient | | Clave (type code) | G = professional activities; A = employment; etc. | | Total payments (percepciones) | Total base of invoices in the year | | Total retenciones | Total withholding for the year |

5.3 Filing

| Item | Detail | |---|---| | Deadline | 1 -- 31 January of the following year | | Method | Electronic (mandatory for >15 recipients or SL/SA) | | Penalty for late filing | €20 per recipient record (minimum €300, maximum €20,000) |

Exemption from Modelo 130 filing

A professional is EXEMPT from filing Modelo 130 if at least 70% of their income from the prior year was subject to withholding (retención). This is common for professionals who invoice mainly to companies.

6.3 Credit Mechanism

| Step | Detail | |---|---| | 1 | Payer withholds 15% and deposits via Modelo 111 | | 2 | Professional claims withheld amounts as credit in annual IRPF return (Modelo 100) | | 3 | If quarterly Modelo 130 payments + retenciones withheld > final IRPF liability → refund |

7.1 Obligation

| Field | Content | |---|---| | Payer details | Name, NIF, address | | Recipient details | Name, NIF | | Tax year | Year covered | | Total payments | Sum of base amounts paid | | Total retenciones | Sum of amounts withheld | | Breakdown | By type if applicable |

Deadline to issue certificado de retenciones

Every payer (retenedor) must issue a certificado de retenciones to each professional before February 1 of the following year.

Mixed Invoice (Goods + Services)

If a single invoice includes both goods (no retención) and professional services (retención), withholding applies ONLY to the services portion. Must be clearly separated on the invoice.

Professional SL (Sociedad Profesional)

When a Sociedad Limitada Profesional (SLP) renders professional services, retención may apply if the activity is listed in Section 2/3 of the IAE (actividades profesionales). Regular SLs providing services are generally NOT subject to retención.

Non-Resident Professional withholding

Payments to non-resident professionals: withhold at 24% (or treaty rate) under IRNR. File on Modelo 216 (not 111). Treaty may reduce/eliminate.

No Activity in Quarter

If registered as retenedor but made no payments subject to withholding in a quarter: file declaración negativa (Modelo 111 with all zeros). Failure to file may trigger penalty.

8.5 Late Filing Penalties

| Situation | Penalty | |---|---| | Filed late, no AEAT notification | 1% surcharge + 1% per month (up to 12 months); 15%+ after 12 months | | Filed after AEAT notification (requerimiento) | 5%/10%/15%/20% depending on delay | | Omission of withholding | 150% of amount not withheld (sanción grave) |

Prohibitions list

- NEVER apply 7% rate without written communication from the professional confirming eligibility - NEVER withhold on invoices from Sociedades Limitadas (SL) for regular services -- only professional partnerships or specific cases - NEVER apply retención to the IVA portion of an invoice -- only to the base imponible - NEVER miss a quarterly filing deadline -- file negative if no activity - NEVER issue a certificado de retenciones with amounts that don't match the Modelo 190 filing - NEVER confuse Modelo 111 (payer's obligation) with Modelo 130 (professional's own estimated tax) - NEVER present tax calculations as definitive -- always label as estimated