Spanish Tax Men Get Tough On British Homeowers
September 12, 2008 | Leave a Comment
Owners of Spanish property could lose their homes if they fail to produce new identification documents proving their non-resident status, writes Ali Hussain of the Times Newspaper.
Britons who use their overseas accounts to pay for their Spanish mortgages and essentials such as utility services and council taxes, have been required by Spanish banks to produce a residence certificate or “Residencia” since March last year.
Failure to produce the new documents could result in bank accounts being frozen and mortgage repayments stopped.
However, some Spanish banks have failed to contact homeowners or given short notice to produce the papers.
One reader, Simon Wells, 52, from Walthamstow, East London, said that on August 15 he was told by his Spanish bank, Cajamar, to produce the documents by September 15.
“This is not easy to do as you have to register in person at a Spanish police station and then have it stamped by a town hall official. We were warned our account could be frozen.”
The requirement is part of an EU initiative to crack down on tax dodgers. Spanish residents are taxed at source, so to avoid paying tax there you have to prove non-residence status.
Britons — there are about 145,000 with bank accounts and properties in Spain, said broker Savills Private Finance — have to declare gains made in Spanish bank accounts to the UK taxman.
You qualify for non-resident status in Spain if you spend fewer than 180 days a year in the country and are able to produce the new document.
Anyone who bought a property before the new rules came into effect may be asked by their Spanish bank to produce the Residencia. Those who bought property after they were introduced will have been told of the requirement.
Residence certificates include your name, address, nationality, date of registration and the “Numero de Identificacion de Extranjeros”, a tax number for foreigners in Spain.
The Spanish Tourism Office said: “If you have a Spanish property, and have not been asked to produce this document, I suggest you contact your bank directly.”
Homeowners can contact the Spanish Ministry of the Interior’s immigration directorate helpline for more advice on 00 34 913 639 071.
To apply for the non-residency certificate you usually need to go in person to the Oficina de Extranjeros or police station in your province of residence.
The document costs about €10-€13, although if you go through a lawyer you may have to pay more than €120 (Approx. £97.20).
Find the nearest Oficina de Extranjeros at mir.es/SGACAVT/extranje/directorio.html
Article courtesy - Times Online.
Spanish Wealth Tax Abolished
August 29, 2008 | 5 Comments
Spanish ‘Wealth Tax‘ has been abolished with effect from 1 January 2008.
As this tax was levied based on assets held on 31 December of a given year, the tax for 2007 will therefore be payable as usual during 2008. However no wealth tax will be payablle for 2008 itself during 2009.
The tax treatment for residents and non-residents is different. Residents pay this tax on their worldwide assets, less various exemptions. Non-residents pay the tax only on assets held in Spain, but there are no exemptions.
Undoubtedly the move, announced after the re-election of the Spanish PSOE government, is designed to mitigate the damage to the Spanish housing market and construction industry in the wake of the current economic downturn; it may also encourage some people to re-locate to Spain if 18 per cent income tax is the only tax they will have to pay.
Whilst because of the allowances available this affected non residents more than residents it is none the less a welcome move.
This also means that non resident owners who did not like to sort out their own wealth tax may no longer need to retain the services of a fiscal representative; however, you do need to check out your agreement with your representative and give them notice as soon as possible.
Spanish Pensions Surplus
March 14, 2008 | Leave a Comment
Spain’s Social Security system is on track to post a surplus in excess of the government’s EUR 8-billion target this year.
MADRID - Spain’s Social Security system is on track to post a surplus in excess of the government’s EUR 8-billion target this year, even in the light of recent increases in unemployment and slower growth in many sectors of the economy, Labour Minister Jesús Caldera said on Wednesday.
Liechtenstein Scandal Update
March 4, 2008 | Leave a Comment
An update to the story earlier - http://spanish-taxes.co.uk/spain/liechtenstein-fraud-probe-spreads-to-spain-as-tax-office-picks-up-trail/
The Spanish tax office confirmed at the weekend that it has obtained the names of 100 Spanish citizens believed to have evaded taxes in Liechtenstein
3 March 2008
MADRID - The Spanish tax office confirmed at the weekend that it has obtained the names of 100 Spanish citizens believed to have evaded taxes in Liechtenstein, becoming the 15th country involved in an international probe into fiscal fraud in the Alpine principality.
Liechtenstein Fraud Probe
February 28, 2008 | Leave a Comment
A rapidly expanding international probe into tax evasion centred on Liechtenstein spread to Spain on Tuesday.
27 February 2008
MADRID - A rapidly expanding international probe into tax evasion centred on Liechtenstein spread to Spain on Tuesday, with the Spanish tax office confirming that it is joining a growing list of countries investigating citizens with bank accounts, companies and foundations in the Alpine principality.
Controversy Surrounds Spanish Tax Cut Vows
January 30, 2008 | 1 Comment
With less than six weeks to go before a hard-fought general election in which the economy has moved centre stage, Spaniards are being showered with promises of tax cuts. But as government and opposition compete with prospective tax breaks, the electorate’s response remains wary.
José Luis Rodríguez Zapatero, the Socialist prime minister who is seeking re-election on March 9, is facing a barrage of criticism this week after promising a €400 ($591, £297) tax rebate for 13m wage earners and pensioners. The measure is expected to cost €5bn, or one-quarter of the government’s fiscal surplus of 2 per cent of gross domestic product.
Read more
Overseas Pension Transfers
January 4, 2008 | Leave a Comment
If you have deferred benefits in the UK they will either come from a personal pension or from an occupational pension scheme.
Both will entitle you to some tax free cash with the balance of the fund to be used to provide an income either via an annuity or via income withdrawal.
Expats ‘vulnerable to IHT laws’
November 28, 2007 | 1 Comment
As the number of Britons taking up residence in Spain and France soared to a total of 961,000 by the end of 2006, the WAY Group reported a ‘significant’ rise in enquiries from expats concerned by highly complex taxation laws in both France and Spain, especially for Brits who are non-domiciled – i.e., living permanently in one of these countries. Read more
Taxing Issues
November 28, 2007 | Leave a Comment
As Benjamin Franklin once said, ‘in this world, nothing can be said to be certain, except death and taxes’. It is true that there is no escape from some taxes, but it is possible to avoid others and man has been attempting to do so since time immemorial. Over recent years, however, it has got considerably harder and the first decade of the twenty first century could well be remembered for the death of banking secrecy. Read more
Inflation Matters
November 28, 2007 | Leave a Comment
Can you remember how much you were earning in 1977? Depending on your job and age it could have been £50 per week, £70, a £100 or perhaps more. In 2007 these amounts would barely cover the weekly supermarket bill.
How much would your 1970s salary buy you today? Would you like to be living on the wages you earned in 1977 but still have to pay today’s prices? It’s a frightening thought. That’s inflation for you.
