A mini guide on non-resident tax in Spain
- Are you a non-fiscal resident for tax purposes?
- If yes, would you like to know the basics?
We’re happy to introduce our mini guide to non-resident tax people.
1. Am I a Spanish fiscal resident?
You are a Spanish fiscal resident if:
- You live more than 183 calendar days a year in Spain or on a Spanish territory
- Your key interest is in Spain, i.e. your spouse or dependants live in Spain
- The principal stake or share of your economic interests are in Spain
You are regarded as being a fiscal non-resident if none of the above apply to you.
However, both non-resident and resident property owners in Spain are obliged to file income tax returns, as the Spanish tax system operates through self-assessment.
Fiscal resident income should include pension payments, rental income, interest received from savings, dividends paid on shareholdings, income from freelance work, and capital gains made from the sale of property or any other asset.
2. When is the Spanish tax year?
The fiscal tax year in Spain begins on 1st of January and ends on 31st of December. Spanish non-fiscal resident annual tax returns are made in arrears and hence declared the following year.
3. How much tax will I have to pay?
In Spain, non-fiscal residents are taxed on their gross Spanish source of income (notional or benefit) and on capital gains arising from assets located in Spain.
Spain operates a progressive income tax system, so the more you earn, the higher rate of deduction.
Non-residents in Spain from non-EU member states or non-EEA countries are required to declare income earned in Spain, at a general rate of 24%.
If you are resident of an EU member state or EEA country with an effective exchange of tax information with Spain, you will be charged a Spanish income tax rate of 19%.
4. As a non-resident and a property owner, what taxes should I pay?
You would be subject to taxes in Spain, and it is important that when the property is owned by more than one person, then each individual is treated as an independent taxpayer, and has to present a separate tax return.
Depending on the main use of the property there are different income taxes to be paid:
A) Notional income tax on properties in private use
This tax is an annual tax and is calculated according to the calendar year – 1st of January till 31st of December. If you weren’t the owner of the property during the whole year or if the property was rented during the year then you will only pay notional income tax for the period in which the property was yours for private use.
B) Income tax on property which is rented out
If you are a non-resident and you rent out your property you are obliged to declare the total amount of rent you received and taxed on the net income.
Tax on rental income for non-fiscal residents is required to be declared quarterly and during the following periods:
1st-20th of April
1st-20th of July
1st-20th of October
1st-20th of January
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