good news on property taxes
good news for residents is that you only have one tax
related to your property. IBI (sometimes known as
Suma) is the Spanish equivalent of rates or council
tax and is payable by residents and non-residents.
However, residents are not required to pay the property
income tax that non-residents are required to but they
do have to declare their worldwide income to the
Spanish tax authority and may be taxed on it according
to current tax legislation.
resident tax declaration, deadline June 30th
is the annual declaration that as a resident in Spain
you must make if:
- You receive one or more pensions from abroad that
total more than 11,200 per year (some civil service
pensions are exempt).
- You are an early retiree with an income through interest
of more than 1,600 a year or you have a rental income
of more than 1,000 a year.
economy and taxes
people recognise that when a country needs to boost
its budget increasing the rate of tax is one way of
doing it. The route that Spain has chosen at this point
in time is not to increase IVA (VAT) but to increase
the percentage of income tax.
The Spanish government intends to do this through an
additional income tax to the 24% (minimum) that residents
already pay. The tax is on a sliding scale according
to how much your income is:
in income tax
53.407 - 120.000
are some of the queries that residents are asking us
daily about. Perhaps one of these relates to you?
I live in Spain do I need to take out residencia?
Yes. If you are in Spain for more than 183 non-consecutive
days in the year then you are legally required to register
yourself as a resident here.
I have one modest pension of 11,000 per year.
I've been told I don't need to complete an annual tax
declaration. Is that true?
Yes. It is true that you don't have to complete the
tax declaration. However, we do still recommend that
you complete one because it acts as proof of your fiscal
residency in Spain.
Being a fiscal resident comes with benefits. It means
- do not have 3% of the sale price retained if you sell
- do not have to pay inheritance tax if your husband
or wife should die
Some people confuse the green residency certificate
with fiscal residency. They are not the same. The green
certificate is your civil residency. It does not prove
that you are living in Spain for tax purposes and without
a certificate of fiscal residency you still might find
that you are classed as a non-resident!
How do I obtain a fiscal residency certificate?
This is issued, when required, by your local tax office
and the Notary will want to see it if you are going
to sign a sale or inheritance deed as a resident. If
the tax authority doesn't have you on record because
you are not presenting a tax return each year (even
a zero one) it is very complicated to convince them
to accept you are actually a resident in order to obtain
As a resident in Spain can I choose to pay my
taxes in my homeland?
You cannot 'choose' where you pay your taxes. If you
live for more than 183 days in Spain then you must pay
your taxes here. The only exception is for those who
have a civil service pensions and in some countries
this has to be taxed at source.
I've been told that as my income is less than 22,000
a year I do not need to make an annual tax declaration.
This is only for those people who are employed in Spain
and only have one employer. They are already paying
tax as they earn through their employer.
fiscal fraud plan
is an increase in activity from the Spanish Tax Authority.
They have been sending out letters to residents and
non-residents who haven't made a tax declaration since
The letter is providing people with an opportunity to
put their house in order before an official investigation
takes place. If you do receive one of these letters
you should contact your fiscal representative immediately
for advice. If you don't have a fiscal representative,
Ábaco will be happy to take the matter up with the Spanish
Tax Authority on your behalf.