Tax in Spain for non-resident and resident
If you are not a Spaniard but you are in Spain, whether it is because you live here or because you are in Spain for a while, or you have some property in Spain, you have obligations with the Spanish tax agency that you should know about.
In order to simplify and so that you can be aware of the due dates and the tax obligations you have, we are going to distinguish between tax obligations if you are a resident or if you are a non-resident in Spain (i.e. resident in another country).
Before that, we can say a person is a Spanish resident when any of the following circumstances apply:
He or she stays in Spanish territory more than 183 days within the calendar year.
The core of his or her economic interests is in Spain (directly or indirectly) or if the husband or wife and minor children that depend on that person live in Spain.
Tax in Spain for Spanish resident
Therefore, if you are a Spanish resident, the obligations for each tax will be the next ones:
Income Tax
The taxpayer has to file an income tax return in Spain if he or she is a resident during the corresponding tax year.
Therefore, you must declare all your income worldwide. Depending on the double tax agreement between Spain and the other country where the taxpayer has obtained some income (wages, rents, interests…), he or she might be able to deduct the amount paid in the third country for a similar tax.
Property tax
If the minimum taxable threshold is exceeded (it depends on the autonomous region in Spain, but it is usually €700.000, not including the usual residence), the resident has to pay property tax in Spain for all his or her property, regardless where they are located.
Depending on the double tax agreement between Spain and the third country, similar taxes paid in that country could be deducted in Spain, and vice versa, depending on the country where the taxpayer lives. Furthermore, some property might be non-taxable.
Statement of property located in a foreign country (model 720)
There is an informative obligation (without having to pay taxes) for Spanish residents to inform about their property outside Spain provided that, for all property and rights in the following sections, the balance or value on December 31st is over €50.000, or if it is a deposit, the average balance of the previous trimester is over €50.000:
a) Bank accounts at financial institutions located in a foreign country.
b) Shares or rights of any company located in a foreign country
c) Loans, bonds…
d) Patrimony assigned in a foreign country to any legal instrument for its management or administration, including trusts
e) Shares of collective investment institutions located in a foreign country
f) Life and disability insurances when the insurance company is located in a foreign country.
g) Real estate and rights on real estate located in a foreign country.
The statement has to be filed only once, for each group of property and rights above, except if a year later, the balance increases in over €20.000 regarding the latest balance declared.
The due date to file this declaration is from January 1st to March 31st each year, for the data of the previous year.
Tax in Spain for Non-resident in Spain
So, if you are a non-resident in Spain, you should bear in mind that:
If the taxpayer does not meet Spain resident´s criteria and is, therefore, a resident in another country, income earned in Spain could be subject to taxes in Spain (depending on the double tax agreement) whether by means of withholdings or non-resident tax.
Income Tax
Like in the previous case, depending on the double tax agreement, the amount paid in Spanish non-resident income tax could be deducted in the income tax of the other country. Each kind of income has a different due date for its corresponding non-resident tax.
-Incomes from a real estate sale: You must declare the non-resident income tax, within the following three months after the first month after the sale.
For example, in a sale on February 1st, the tax will have to be paid from March 1st to May 31st. If the purchaser withholds an amount, this could be deducted.
-Attributed income from real estate located in Spain: The calendar year following December 31st of the corresponding tax year. For example, for attributed income from real estate in tax year 2016, tax can be paid until December 31st 2017.
Other incomes (wages, pensions, rents…)
The due date for non-resident tax will be the first twenty calendar days of April, July, October and January for incomes that are due in the previous trimester. For example, for a rent due in the first trimester, the non-resident income tax must be paid until April 20th.
The exception to those rules would be:
If the result of the tax return is zero, the due date will be from January 1st to January 20th of the year after the due rent
If the tax result is favorable to the taxpayer, the due date is from February 1st of the year after the due rent, within four years.
Property tax
If the minimum taxable threshold is exceeded (it depends on the autonomous region in Spain, but it is usually €700.000, not including the usual residence), non-resident people must file property tax over their property located in Spain. In all cases, the double tax agreement between Spain and the other country has to be studied, to know if there is some non-taxable property and avoid double taxation.
