Tax

Are you resident or non-resident for Spanish Tax?

Generally speaking the following rules can be applied to expatriates living in Spain.

You will be treated by both the Spanish tax office as tax resident in Spain if:-
 

• You left the UK to move permanently  to Spain or your absence and full-time work
       in Spain last at least the whole tax year
• Your visits to the UK are less than 183 days in a tax year and average less than
      91 days a tax year over a maximum of 4 consecutive years

Therefore, if you spend more than 183 days in a tax year in Spain, you automatically become a Spanish tax resident and are responsible for registering to pay tax in Spain and not in the UK.

Also, if you are a tax resident in Spain you are liable to pay tax on income from your worldwide assets.

It is vitally important, therefore, that each individual expatriate living in Spain answers the following questions to determine tax status and liability:-

1. Am I resident in Spain (see above)?
2. Have I registered correctly with the Spanish tax office?
3. Have I informed the UK Inland Revenue?
4. Have I made a suitable Spanish will (key for Inheritance Tax planning - IHT)?
5. How much income tax will I pay in Spain?
6. What is my exposure to Capital Gains Tax (CGT)?
7. What is my potential exposure to IHT?

A complete review of your potential tax liabilities is essential and proper tax planning is the key.

Rose FS can provide each client with tailor-made, confidential, tax planning and accountancy advice, and can help you answer all of these questions and more.