Eliminating Legal Ambiguities

In Spain, every expense in your business is subject to the personal interpretation of a state treasury official. Entrepreneurs widely acknowledge that the government operates like a tax-collecting mafia. Treasury officials receive a commission each time they open an investigation into a taxpayer. They still receive the commission even if a judge ultimately rules in favor of the taxpayer. As a result, these officials have a significant incentive to scrutinize your business’s accounting in the most subjective way possible.

What they typically do is wait three years, allowing enough time for you to accumulate errors in your accounting, before opening an investigation. They assume you will have invalid invoices or expenses that they consider unrelated to your business. And if they are lucky and your fine exceeds the €120,000 threshold for a prison sentence, they extort you into paying even more to avoid a criminal sentence.

For entrepreneurs like me, for example, it can be incredibly challenging to justify business-related expenses, such as purchasing a computer or multiple phones for mobile app development, buying a camera to create marketing content to promote an app, or traveling to attend a developer conference.

You constantly worry about paying for things through your company that you are sure they are business-related, but not sure they will be interpreted like so in the future, like unused domain names, SAAS subscriptions you need, new AI tools that only you understand the relevance of, and more.

Entrepreneurship is supposed to be about taking the risk of not being able to produce something that solves your clients’ problems. Increasingly, however, it’s becoming about taking the risk of not ending up in jail for an accounting error.