Spanish Tax System Tips

Some legal tips about the Spanish Tax system

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These are some tips that you need to take into account when dealing with the Spanish Tax system.

When I am supposed to lodge my income tax in Spain?

If you are a resident in Spain for 183 days or more, you are considered a Spanish Tax resident. As such, you are required to submit an annual Spanish Resident Tax Return, known as a “Declaración de la Renta”, as long as you comply with certain levels of income.

Some people, however, have more complex personal situations and they spend their time between a few countries or/and have property or business interests in other countries. In these cases, there are International Double Taxation Treaties stating where the person subject to the tax should declare their income for tax purposes.

What is the minimum income to be liable for income tax?

If you have one source of income, not taxed at source, and you earn over 12.000 euros in pensions, you are obliged to file a tax return. However, that does not mean that you will end up paying taxes since it depends on your personal circumstances, as we explain below.

What happens if I file my tax return late?

  • If there is no tax payable but you are obliged, there will be a fine of around 100 euros for filing a late tax declaration.
  • If there is tax payable there is a charge to be paid. This is generally a percentage of the amount owed; it also depends on how late the tax declaration was submitted.

Are there any tax deductions for living in Spain?

Yes, some of the main deductions are:

  • A personal tax-free allowance.
  • Married couples allowance for joint declarations.
  • Employment allowance.
  • Child tax allowance.
  • Deductions for private pension plans.
  • Taxation regime for income from annuity pensions.

Have there been any changes to the Spanish tax system recently that I should be aware about?

Yes. Here are a few of the most important changes:

  • Double Taxation: This treaty affects individuals and companies who are tax residents in Spain, but who have income from the UK too. Please note that Income on the Civil Servant pensions needs to be included from the 1st of January of 2015.
  • Disclosure Rules: Spanish residents must declare all overseas assets worth over 50.000 euros.

What is the Income Tax Calendar?

  • 1st of January until the 31st of March. Declaration of Overseas Assets (Form 720).
  • 6th of April until the 30th of June. Personal Tax Declaration (Form 100) and Personal Wealth Tax Return (Form 714).
  • 1st of January until the 31st of December. Non-Residents Income Tax (Form 210).

Can I pay the Tax in stage payments?

Yes. The first payment (60%) will be taken on the 30th of June if you pay it by direct debit. The second payment (40%) will be taken on the 1st of November. If you would like to make the payment in more stage payments you will need to submit an application to the Tax Office.

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