| --The |
| © 2010 www.expresslegalcafe.com English law Firm & Solicitors on the Costa Blanca for open and honest advice & legal help living in Spain and the Spanish legal system |
 |  |  |  |  |  |  |
| Reception Tel 966 874 548 Mobile 699 196 115 FAX 966 874 551 |
Income Tax in Spain
( assumes a question from a pensioner owning their own home in Spain )
If you live in Spain for more than 183 days in a year, you are legally obliged to
file a Spanish tax return. This is whether or not you have a residence certificate.
The declaration includes your world-wide income, pensions and any interest on
savings or investments etc. The time frame for filing the declaration is from 2nd
May to 27th June. So, you have until 27th June 2012 to file your declaration for the
2011 Spanish tax year. Even if you have no Tax to pay you must file a nil return as
this could benefit you greatly in the future when selling property in this region.
The Spanish tax year coincides with the calendar year i.e. 1st January to 31st
December, whereas the UK tax year runs from April to April. This means that for
your first year of Spanish fiscal residence you can be hit for tax both in the UK and
Spain. However, help is at hand in the form of the double tax agreement which
exists between Spain and the UK. If you are “lucky” enough to be paying tax at the
higher rate in the UK and your Spanish tax is a smaller amount don´t expect the
Spanish tax-man to give you a refund, however. If the tax paid in the UK is less
than the amount you would pay in Spain then you only pay the difference to the
Spanish tax-man.
( assumes a question from a pensioner owning their own home in Spain )
If you live in Spain for more than 183 days in a year, you are legally obliged to
file a Spanish tax return. This is whether or not you have a residence certificate.
The declaration includes your world-wide income, pensions and any interest on
savings or investments etc. The time frame for filing the declaration is from 2nd
May to 27th June. So, you have until 27th June 2012 to file your declaration for the
2011 Spanish tax year. Even if you have no Tax to pay you must file a nil return as
this could benefit you greatly in the future when selling property in this region.
The Spanish tax year coincides with the calendar year i.e. 1st January to 31st
December, whereas the UK tax year runs from April to April. This means that for
your first year of Spanish fiscal residence you can be hit for tax both in the UK and
Spain. However, help is at hand in the form of the double tax agreement which
exists between Spain and the UK. If you are “lucky” enough to be paying tax at the
higher rate in the UK and your Spanish tax is a smaller amount don´t expect the
Spanish tax-man to give you a refund, however. If the tax paid in the UK is less
than the amount you would pay in Spain then you only pay the difference to the
Spanish tax-man.
Most people will pay about the same amount of tax as they paid in the UK.
There is a system in Spain similar to the personal allowances system in the UK.
The current** amount for a pensioner over 65 and under 75 is 6,069€. You can
2,652€, if your pension is over 13,000€, before the tax is worked out.
Remember you will need to claim the double tax relief from HMRC to make
sure that you are in future exempt from UK tax. They will not give it to you
automatically. It is vital to keep your Tax and other financial commitments in order
especially if you later decide to leave Spain and return to the UK.
Unless your Spanish is reasonably good and you are able to visit the tax office
(“Agencia Tributaria” affectionately known as “hacienda”) it is better to consult an
expert to deal with the red-tape for you. All you need to do is take your passport or
residence certificate, bank statements showing any interest paid to you, pension
slips showing your income, statements showing income from any investments and
any certificates/tax returns (P60) with the UK tax-man. Also your last IBI bill.
We will do the rest for you hassle-free at a very modest cost. Contact us
Once you are in the Spanish system, your spouse/children can benefit from
the substantial reductions on the Spanish inheritance tax which apply in the
Valencia region if you are on the “padron” (voters roll) and have owned your house
for at least 5 years.
** based on the allowance for year 2012 Return to Legal Services.
There is a system in Spain similar to the personal allowances system in the UK.
The current** amount for a pensioner over 65 and under 75 is 6,069€. You can
2,652€, if your pension is over 13,000€, before the tax is worked out.
Remember you will need to claim the double tax relief from HMRC to make
sure that you are in future exempt from UK tax. They will not give it to you
automatically. It is vital to keep your Tax and other financial commitments in order
especially if you later decide to leave Spain and return to the UK.
Unless your Spanish is reasonably good and you are able to visit the tax office
(“Agencia Tributaria” affectionately known as “hacienda”) it is better to consult an
expert to deal with the red-tape for you. All you need to do is take your passport or
residence certificate, bank statements showing any interest paid to you, pension
slips showing your income, statements showing income from any investments and
any certificates/tax returns (P60) with the UK tax-man. Also your last IBI bill.
We will do the rest for you hassle-free at a very modest cost. Contact us
Once you are in the Spanish system, your spouse/children can benefit from
the substantial reductions on the Spanish inheritance tax which apply in the
Valencia region if you are on the “padron” (voters roll) and have owned your house
for at least 5 years.
** based on the allowance for year 2012 Return to Legal Services.
