Tag: tax

NEW REGISTRY HOLIDAY HOMES ANDALUSIA

Written by Gustavo Calero Monereo on 9 March, 2016. Posted in Andalucia, Property law, rentals.

Registration tourist homes in Andalusia — New registry holiday homes Andalusia

A new decree (28/2012, of 2nd of February) about homes for tourist purposes in Andalusia, will enter into force on 12 May 2016. The aim of this decree is to regulate the large market of homes belonging to individuals and let by them as a holiday accommodation at different periods throughout the year.

These lettings, by days or weeks, as well as the use and terms of the lease, were not regulated until now. Therefore, the purpose of this Decree is to ensure that these homes meet a series of minimum requirements to be let, establishing the rights and obligations of both owners and customers and requiring the registration of the homes.

Clearly, this Decree has a significant impact in Andalusia, especially in Costa del Sol and Axarquía, for touristic cities like Granada, Malaga, Seville, and municipalities such as Nerja, Malaga, Torrox, Fuengirola, Marbella, Mijas, etc., which have many homes used for rentals of this type.

What is a home for tourist purposes?

These are homes located on residential land, offered in exchange for a price for the accommodation of people on a regular basis and with tourist purposes. Homes are understood to be let on a regular basis for tourist purposes if they are marketed or promoted in a tourist marketing channel. E.g.: Airbnb, Tripadvisor, Windu, property agencies, etc.

If you are the owner of a home on residential land in Andalusia and, during the year, you offer it for letting for days or weeks, this home will have tourist purposes. Therefore you must comply with the regulations of this Decree if you wish to continue to engage in this activity legally.

Which homes are excluded from this regulation?

Rural homes (houses in the country side) offered for holiday letting are not regulated by this decree. However, they do have the obligation of registering as a tourist home in the rural environment (Vivienda de Turismo en el Medio Rural). Therefore the owners of these homes must also register them before the Government of Andalusia but under a different regulation.

Homes let by the same person for two consecutive months or longer are not considered holiday homes and, therefore, do not need to register. This refers to homes let under a lease agreement for a period exceeding 2 months.

If, during the year, you let your home for over 2 months but you also let it for days or weeks, you will have to register it. Lettings exceeding 2 months and lettings for days or weeks are compatible in the same home.

An exemption to the application of this Decree is established when a single person has 3 or more homes for holiday lettings, within a radius of approximately 1 km. In this case, this Decree will not be applicable and regulations on tourist apartments will apply.

What does this Decree entail?

The obligation to register any home on urban land that the owner whishes to use for holiday letting before the Registry of Tourism in Andalusia. Once the home is registered, a registration number will be issued that must be displayed when offered for letting. The home only needs to be registered once and the registration number can be used for subsequent letting. The owner is the one legally responsible for registering the home and this home can´t be used for holiday letting unless it is registered before the Government of Andalusia by 12 May this year.

What are the registration requirements?

The home must be on residential (urban) land.
It must have a Licence of First Occupation. If it does not have the initial occupation permit, a certificate from the City Hall showing the location and use of the home should be accepted, but we are waiting for the written confirmation of the Junta of Andalusia.
Depending on the season, all accomadations need to be equipped with cooling and heating. In this case, the period for the owner lacking these installations is extended until 12 May 2017 and the property may be let during that period.
The home must have the essential furniture and furnishings required for the total amount of persons it is rented out to.
A first-aid kit is required.
It must have tourist information about the area, showing places to visit, restaurants, etc. A small tourist guide or advertisement from the corresponding tourist office can help you meet this requirement.
It must have complaint and claim forms available to customers in a visible place.
The home must be cleaned upon the check-in of new customers.
Linen and tableware appropriate for the number of people.
Contact telephone number to handle problems and emergencies.
Information and instructions about the appliances/equipment in the home must be available in a specific place.
Information must be provided about internal rules for the use of facilities, according to the regulations of the Residents’ Association (community rules).
The maximum amount of people allowed in the property is 15.
In case you are renting out a room, instead of the entire house, the maximum amount of people allowed per room is 4.
All bedrooms must have external ventilation through windows.

What are the obligations for each customer?

A contract document must be signed by all parties, showing the details of the property, the owner, the number of days of stay and the price of accommodation, as well as the identification of people with a copy of their passports or residence cards. We are talking about a simple document of just 1 or 2 sheets, that the owner must keep for a period of 1 year.

Likewise, the owner must notify the Guardia Civil (police) of the occupation of the home with each new customer. The owner must provide a copy of the contract and the passports/identity cards of occupants.

What happens if I don’t register my home in this registry?

Inspection services may review the situation and begin penalty proceedings. Be careful, because the fine may range from 2,000 to 18,000 Euros.

Furthermore, you have the obligation to allow inspectors to enter the home when they visit it to verify that it meets the requirements for letting. If you do not allow inspectors to enter the home, you could be fined for very serious misconduct, with a large penalty.

What else does this Decree regulate?

Among other things, it regulates the rights of customers in cases where there is a conflict with the owner regarding the price of the letting, check-in and check-out times, advance payments or deposits for letting, etc. Ultimately, it regulates the terms for prices, booking, advance payments and cancellation, unless otherwise agreed in writing between the parties.

Taxes on income received

This registry is of an administrative nature, dependent on the Government of Andalusia and created to regulate the conditions of holiday lettings. It has nothing to do with the obligation to pay taxes on rental income. Likewise, if your home is registered in this Registry but you do not rent it out, it will have no cost to you.

The payment received for letting a home -either for holidays or long-term (longer than 2 months)- must be declared before the Tax Agency, which depends on the Central Government. The income tax you pay depends on the fact wheter you are a fiscal tax-resident in Spain (IRPF tax) of not (IRNR tax).

Legal advice

Even though the Decree will enter into force on 12 May, it is already possible to start the process to register homes in this Registry. If you have one or several properties being let as holiday homes you must register them before the Government of Andalusia. We can take care of processing the documents you need to register your home. We can also inform you about all the requirements that your home must meet and your obligations as its owner. Don’t hesitate to contact us at 0034 – 952 532 582 or info@cdsolicitors.com

Author: Gustavo Calero Monereo, C&D Solicitors (lawyers)
Torrox-Costa (Malaga/Costa del Sol/Nerja/Andalucia)

SPANISH INCOME TAX RETURN FOR NON TAX RESIDENTS FILING BEFORE THE 31st OF DECEMBER

Written by Francisco Delgado Montilla on 22 November, 2015. Posted in Featured, Headline, lawyer, legal advice, non tax resident, Tax Law, taxes.

If you are a non-resident in Spain and own a property there, you are liable to Spanish Income Tax for Non-Residents payment (Spanish IRNR). This issue was already considered in former articles on our website in November 2010 and October 2013:

When a property is owned by a married couple or several persons, each of them becomes an independent taxpayer, so that they should file tax returns separately according to the ownership interest they have on this property.

Depending on the property final use, the income subject to tax payment may be distinguished between:

1.- INCOME FROM LEASED PROPERTY: when the property is leased, the income to be declared will be the whole amount received, excluding Spanish VAT.

2.- TAXABLE INCOME OF URBAN REAL PROPERTY FOR PERSONAL USE: as this is the most common case, it will be deeply analyzed below:

The income to be declared is the amount resulting from the application of the following percentages to the property cadastral value:

Generally, 2 per 100.
In the event of property with a revised or modified cadastral value, 1.1 per 100 from the 1st of January 1994.

Once these percentages are applied, the final payable amount should be calculated for each of the owners pursuant to how long they have been owners of the property during the year.

Tax form 210 is used to pay this tax and it can be downloaded from the official web of the Spanish Tax Authority (A.E.A.T.), including the steps in English to fill it in. It is worthy mentioning that it is not easy to understand them.

Our office is currently dealing with the IRNR season 2012. The deadline to file this tax return expires on the 31st of December of this year. Although if you want to place the payment as a direct debit in your bank account the form must be filled before the 22nd of December. Thus, if you have owned a property in 2012, you should contact your tax advisor to fulfill this tax liability as soon as possible.

If you need our advice, we will be pleased to help you.

Author: Francisco Delgado Montilla, C&D Solicitors (lawyers)
Torrox-Costa (Malaga/Costa del Sol/Andalucia)

ENERGY CERTIFICATE AND IBI PROPERTY TAX REDUCTION

Written by Gustavo Calero Monereo on 25 October, 2015. Posted in Andalusian, discount, english speaking solicitor, IBI, malaga, Property Tax.

In September, the Government of Spain, through a legislative amendment, opened the door for city governments to be able to offer a discount (reduction) in Property Taxes (IBI) from 1 January 2016.

This legislative amendment introduces the possibility of offering a reduction of 20%, 16%, 12%, 8% or 4% of the IBI of a property if its energy performance certificate shows a rating of A, B, C, D, or E, respectively.

Now that the central government has allowed for this modification of the IBI, it will now be up to each city government to decide whether they want to apply this discount.

This is so because Property Taxes are of a local nature. City governments are responsible for their management, as long as collection of this tax is carried out pursuant to the Law on Local Treasuries, which is the one amended by the central government to allow for this IBI discount.

That said, if you own a home in Spain and you want to know whether you can save on property taxes, I advise you to do the following:

Ask your city government whether it plans to apply this IBI discount from 1 January 2016. If the answer is NO, this settles the matter.
If your city government says YES to the previous question, look at the energy performance certificate of your home to find out its rating.

If you have purchased a home in Spain within the last 2 years, be aware that this certificate will be part of your deed of sale.

If you do not have an energy performance certificate, you may be interested in ordering one, so you can know the energy rating of your home and find out whether you can get an IBI discount to pay less every year.

Regarding the energy performance certificate, most properties “fail”, i.e. they have a very low rating. Without a doubt, it can be said that homes in Spain are not energy efficient.

If the rating in the energy performance certificate of your home is very low, do not panic since, unfortunately, this is normal. According to the information published by the idealista website at the beginning of this year, 95% of homes fail in energy efficiency.

In my opinion, this measure, introduced by the central government, is positive, as it is always good to “reward” homes that are better insulated and require lower energy use to be habitable. When they use less energy, they pollute less.

From a seller’s point of view, this certificate is seen as yet another expense and another bureaucratic hindrance to sell a property. But, if the certificate is completed well, it provides very valuable information to buyers, as they will know the energy efficiency of the home before buying it and will be able to make improvements in this sense.

Regarding the energy performance certificate, it should be said that it must be available when a home is on sale or up for rental (leases longer than 4 months) so that, from a buyer’s point of view, one can know the energy efficiency of a home from the moment one becomes interested in it.

Author: Gustavo Calero Monereo, C&D Solicitors (lawyers)
Torrox-Costa (Malaga/Costa del Sol/Andalucia)

THINKING ABOUT SELLING YOUR PROPERTY IN SPAIN? DO IT IN 2014 TO AVOID PAYING MORE TAXES

Written by Gustavo Calero Monereo on 19 September, 2014. Posted in Capital Gains, costa del sol, english speaking solicitor, Headline, legal advice, nerja, non tax resident, tax resident.

Capital Gain Tax when selling Spanish property

Next 1st of January 2015, a new tax reform will come into effect. This reform was approved in August by the Spanish Government and, among other measures, it will affect taxation of capital gains obtained as a result of a property sale in Spain:

1) Tax reduction from 21 % to 20 % for capital gains earned by a sale if the seller is non-tax resident in Spain.

2) Tax reduction from 21 %-27 % to 20 %-24 % for capital gains earned by a sale if the seller is a tax resident in Spain.

In these terms, it may seem that, from the 1st of January 2015, taxes for capital gains earned by a property sale will be reduced. However, you should be careful with this reform, since from the 1st of January 2015 sellers of a property may not be enable to apply reducing and updating coefficients of the purchase value when the property was bought.

You may wonder what it means; and it means that heretofore if you bought a property and then you sold it, when calculating the capital gain from the sale, you could update the price paid when you bought the property a few years ago, however, from 2015, this purchase value will not be allowed to be updated. For example:

You bought a property by public deed for 150,000 Euros in 2003 and now it is on sale for 200,000 Euros.

1 ) IF YOU ARE NON-TAX RESIDENT IN SPAIN

– if you sell your property in 2014: the updated purchase value would be 177,540.00 Euros and 4,716.60 Euros should be paid for taxes as a result of a capital gain of 22,460.00 Euros taxed at 21 % rate.

– If you sell your property in 2015: the purchase value would be 150,000 Euros (no update is allowed) and 10,000 Euros should be paid for taxes as a result of the capital gain of 50,000 Euros taxed at 20 % rate.

2) IF YOU ARE TAX RESIDENT IN SPAIN

– If you sell your property in 2014: the updated purchase value would be 177,540.00 Euros and 5,375.00 Euros should be paid for taxes as a result of the capital gain of 22,460.00 Euros obtained.

– If you sell your property in 2015: the purchase value would be 150.000 Euros (no update is allowed) and 10,880.95 Euros should be paid for taxes as a result of the capital gain of 50,000 Euros.

As shown by these examples, tax savings when selling your property in 2014 or from the 1st of January 2015 may be worthy of consideration.

Other examples of updated values with the same prices above: if you bought the property in 1995, the updated value in 2014 would be 210,750.00 Euros; then, you should not pay taxes for capital gain if it is sold in 2014 and you should pay 10,000 Euros for taxes if it is sold in 2015.

If you bought the property in 2013, the updated value in 2014 would be 154,454.00 Euros, then if you sell it in 2015, you would pay less taxes than selling it in 2014; however, this a small saving between 400-700 Euros according to whether the seller is a non-tax resident or tax resident in Spain.

In these examples, neither deductible expenditures (taxes, notary, registry and estate agent fees, etc.) have been taken into account, nor other possible deductions to which fiscal residents may be entitled.

CONCLUSION: if you are thinking about selling your property in Spain, you will probably be interested in doing it before the end of 2014, you will avoid paying more taxes for the profit obtained on the sale.

If you have recently bought a property or the sale price is very similar to the purchase price, you may be interested in selling it from 2015, as there is not a great difference regarding taxation. If you are selling at a loss, that is, you obtain no profit, it makes no difference whether selling it this year or the following.

Nevertheless, the most coherent decision is to make your own tax estimation for your particular case in order to know whether it is more convenient to sell this year 2014 or not, so you will have a clear idea of your possible tax savings.

Author: Gustavo Calero Monereo, C&D Solicitors (lawyer)

Torrox-Costa (Malaga/Costa del Sol/Andalucia)

BUYING YOUR HOME IN SPAIN BEFORE THE 31ST DECEMBER 2012

Written by Gustavo Calero Monereo on 15 November, 2012. Posted in Capital Gains, developer, english speaking solicitor, Headline, Income, Property law, taxes. No Comments on BUYING YOUR HOME IN SPAIN BEFORE THE 31ST DECEMBER 2012

In this year we have published several blog articles regarding tax changes on property subjects which the Spanish Central Government has passed over this year. In that regard, the deadline to implement most of them finishes on the 31st of December.

As a requirement to increase tax revenues, this new year will bring the removal of some tax reliefs which are currently enjoyed by home buyers in Spain.

From the 1st of January, home buyers in Spain should consider that the following tax incentives will disappear:

1) 50% tax exemption on capital gains obtained for the future sale of the property which had been purchased before the 31st of December 2012.

2) The Spanish VAT rate will increase from 4% to 10% for new housing purchases.

3) Tax deduction for main residence purchases, applicable in the event of tax residence in Spain.

Tax saving when buying a home before the 31st of December may become a very significant factor to keep in mind for those looking for a property in Spain and hesitating about different alternatives to take a decision. In these cases, we recommend them to make up their minds before the end of the year in order to take advantage of the above mentioned tax relieves.

Furthermore, sellers have also a reason to sell before the 31st of December—from the 1st of January 2013, Spanish Plusvalia (municipal capital gains tax on land) rate may increase from 66% to 150%, depending on the municipality where the property is located.

It is also worth mentioning that Town Councils reviewing cadastral values in the last 5 years were obliged till now to apply a 40% to 60% reduction on the resulting payable fee for Plusvalia tax. However, from the 1st of January 2013 this obligation will disappear—then, each Town Council may decide whether to apply or not this reduction. Regarding the current economic situation of most Town Councils, all of us may have to get use to the idea that just a few of them may decide to apply this reduction.

Author: Gustavo Calero Monereo, C&D Solicitors (lawyers)
Torrox-Costa (Malaga/Costa del Sol/Andalucia)

INCREASE OF THE VAT AND OTHER TAX MEASURES REGARDING THE PROPERTY IN SPAIN

Written by Francisco Delgado Montilla on 17 July, 2012. Posted in conveyancing, developer, Featured, legal advice, taxes. No Comments on INCREASE OF THE VAT AND OTHER TAX MEASURES REGARDING THE PROPERTY IN SPAIN

The Spanish Government, particularly Mr Cristobal Montoro, Chancellor of the Exchequer, has announced last Friday 13^th of July that, from the 1^st of January 2013, will apply a VAT of 10% (of the declared value of the property) to new build properties, with regard to the current 4%.

During the press conference after the Council of Ministers, the Chancellor has recalled that the application of the reduced VAT (4%) for the purchase of a property had an “expiry date”, that the Government has stated today for the beginning of 2013.

Mr Montoro has also indicated that, according to the recommendation of the EU, from the 1^st of January 2013, “the tax deduction on the purchase of a property in Spain will be abolished”.

So, if you are thinking of purchasing a new property, it will definitely be crucial, from a financial and economic point of view, that you do it before the 31^st of December 2012. To see it more clearly, the difference in a direct taxation regarding a property valued at 200 000,00€ is 12 000,00€.

If you are planning to purchase a property here in Spain, do not hesitate to contact a professional lawyer for a deeper tax planning.

Author: Francisco Delgado Montilla, C&D Solicitors (lawyers)
Torrox-Costa (Malaga/Costa del Sol/Andalucia)

TAX EXEMPTION WHEN BUYING A PROPERTY BEFORE 31/12/2012

Written by Gustavo Calero Monereo on 6 June, 2012. Posted in Capital Gains, discount, english speaking solicitor, Featured, Headline, Income, legal advice, malaga, NON RESIDENT, property law, resident, solicitor, taxes. No Comments on TAX EXEMPTION WHEN BUYING A PROPERTY BEFORE 31/12/2012

Regarding the current financial situation, which is reflected in the drop of property sales in Spain every three months, the Spanish Government has passed a new tax exemption. This exemption tries to promote the sale of properties and may become very interesting for both individuals and bodies corporate considering buying a real estate property in Spain in the short term, whether they purchase commercial premises, homes, offices, garages, plots, storage rooms, etc.

On the 12th of May 2012, the Central Government passed the Spanish Royal Decree-Law 18/2012 of 11th of May on the restructuring and sale of the property assets of the financial sector. This regulation included in its First, Second and Third Final Provisions the tax exemption for bodies corporate and individuals, whether resident or non-resident in Spain. This reform law allows all those buying a property from the 12th of May 2012 till the 31st of December 2012 to pay taxes only on the 50% of the capital gains tax when selling the property subsequently, whether in 1, 5, 10…etc years, while the remaining 50% is free of charges.

This exemption may save an important amount of money, because if a property is currently sold in Spain, capital gains are taxed at 21% for non-residents (19% from 2014), at 27% for resident taxpayers in Spain (21% from 2014) and at 30% for bodies corporate.

Here we present an example: imagine you are thinking about buying a property in Spain considering the current market opportunities; the price for this property may be EUR 200,000; the following eventual scenarios may occur according to the date of purchase when selling this property, for example, in 2017 for a sale price of EUR 270,000:

1) Non-resident taxpayers: EUR 70,000 of capital gains at 19% makes a total payment of EUR 13,000; if the purchase is performed before the 31/12/2012, the total payment would be EUR 6,650.

2) Resident taxpayers: EUR 70,000 of capital gains at 21% makes a total payment of EUR 14,700. If the purchase is performed before the 31/12/2012, the total payment would be EUR 7,350.

3) Corporate: EUR 70,000 of capital gains at 30% makes a total payment of EUR 21,000. If the purchase is performed before the 31/12/2012, the total payment would be EUR 10,500.

Obviously, this tax saving is not definitive in order to decide whether to buy a property or not in Spain, as it is not possible to know whether prices may go down much more nor the gains resulting from the eventual property sale. However, this fact may be a helpful factor to take a decision for those considering buying a property, especially for those non-speculative potential buyers whose main purpose is to enjoy this property for many years; thus, the longer they own the property, the greater the capital gains may be when selling it. Look at the figures and draw your own conclusions.

Author: Gustavo Calero Monereo, C&D Solicitors (lawyers)
Torrox-Costa (Malaga/Costa del Sol/Andalucia)

HAVE YOU ALREADY PLANNED YOUR INHERITANCE TAX?

Written by Gustavo Calero Monereo on 27 February, 2012. Posted in Featured, Headline, Inheritance Tax, lawyer, legal advice, PROBATE LAW, resident, taxes, wills. No Comments on HAVE YOU ALREADY PLANNED YOUR INHERITANCE TAX?

Residency avoids Andalucian inheritance tax

The Inheritance tax imposes taxes on an inheritance received because of death. This tax is paid after a person’s decease and the heir is the taxpayer legally bound to pay it. It shall be paid within the following 6 months since the person deceases. Here below we present an example in order to obtain a better understanding on this tax:

Mr. Smith deceased last January 2012; once he retired and sold his home in England in 2003, he moved together with his wife to Andalusia. Then, they bought a small semi-detached house with very nice views to the sea, which they enjoyed together for all these years.

After Mr. Smith’s decease, his wife initiated the testamentary procedures and she was surprised when she found out that she had to pay 15,490.82€ for the Inheritance tax when inheriting her husband’s estate.

Why did she have to pay such an amount?

Assessed value of the 50% of Mr. Smith’s property__125,000.00 €

Money in Mr. Smith’s current account____________10,000.00 €

Total amount of Mr. Smith’s estate______________135,000.00€

Mrs. Smith’s Inheritance tax payment total account: 135,000.00€ minus 15,956.87 € (reduction allowed because of the beneficiary’s relationship), equals 119,043.13€ (taxable income). According to the current assessment scale, the result is a total tax due of 15,490.82€. That is to say, the widow had to pay 13.01% of the estate total value awarded.

How could this payment have been reduced? First of all, Mr. and Mrs. Smith should have been registered as residents in the municipality of the Town Hall, called in Spain Padrón Municipal, when they bought their home because heirs are allowed to benefit from some tax reductions for Inheritance tax purposes when proving their residence in Andalusia for at least two years and a half during the last five years. A certificate of registration as a resident in the municipality is required to prove this fact.

If Mr. and Mrs. Smith had been registered as residents in the municipality, the widow would not have had to pay any Inheritance tax, because the heirs-residents in Andalusia next of kin of spouse are tax exempt from paying Inheritance tax when the value of the awarded estate does not exceed 175,000.00€, and the heirs pre-existing wealth is less than 402,678.11 €uros.

Apart from this tax exemption, other tax exemptions are applied, as for example, 99.99% reduction when the transferred home has constituted the habitual residence of the deceased. The certificate of registration as a resident in the municipality is required one more time to prove it.

In Spain, Inheritance tax is administrated and collected by regional governments, so that they establish their own regulations to be applied within their own region. In this case, the above mentioned tax exemptions are applicable in Andalusia.

Mr. Smith’s example has been presented above, because many of the foreign citizens who are resident in Spain declare in their Last Will that the survivor spouse inherits the whole of the deceased’s estate. Then, we wanted to provide a simple and practical example related to Inheritance Tax, taking into account that it is essential to make one’s will in Spain only for the estate placed in Spain in order to make the legal procedures easier.

In addition, the Inheritance Tax in Spain is considered a progressive tax; therefore, the higher the value of the inherited estate, the bigger the tax burden for the heir. Furthermore, the heirs’ degree of kinship may be also penalized, so that the deceased’s cousins or friends may pay more than his wife or children for the same awarded estate. For example, if the total value of the inheritance is 400,000.00€, the deceased’s wife or child non resident may pay 27%-28% approximately of this amount for Inheritance Tax, that is, 112,000.00€; on the other hand, the deceased’s cousin or friend, resident or not resident in Andalusia, may pay the double—about 224,000.00€.

Some financial products, as Life Insurances, are very interesting in order to reduce the tax effect for heirs—pursuant to legal provisions, this type of products are firstly planned to pay the heir’s Inheritance tax and any residuary estate may become part of the heir’s estate.

A good tax planning is important to minimize the fiscal effects of the Inheritance tax. Most of the times, it is a question of looking at the figures and analyzing what is the most interesting decision depending on each particular case.

Author: Gustavo Calero Monereo, C&D Solicitors (lawyers)
Torrox-Costa (Malaga/Costa del Sol/Andalucia)

ANNUAL TAXES FOR NON-RESIDENTS WHEN OWNING A PROPERTY IN SPAIN

Written by Francisco Delgado Montilla on 19 November, 2010. Posted in Featured, Headline, Income, Inmobiliario, NON RESIDENT, property law, taxes. No Comments on ANNUAL TAXES FOR NON-RESIDENTS WHEN OWNING A PROPERTY IN SPAIN

Inheritance tax Spain — solicitor english speaking

All property owners in Spain are liable for some taxes every year. Even if you are (tax) non-resident, when owning a property, you must fulfill your fiscal obligations here in Spain by submitting your yearly income tax declaration for non-residents (IRNR).

In the event you are non-resident in Spain, the reason why you are subject to this tax is because your Spanish property is not your principal residence. Non-residents remain subject to the tax because, by definition, Spain is not their principal residence, so that it is necessary to calculate your property owners’ imputed income tax on your second and further homes you may have.

Be aware of tax year in Spain ends by the 31^st of December, so that your income tax declaration should be submitted to Tax Authorities before this date, by filling out the application form number 210.

The calculation of the IRNR will depend on several factors, among others, the type of property (urban or rustic), when the rated value of the property for tax purposes was raised, price or valuation of the property, etc.

If you are in this situation and you still have not submitted your Property owners’ imputed income tax, you have one month approx. to be up-to-date with Tax Authorities.

Author: Francisco Delgado Montilla, C&D Solicitors (lawyers)
Torrox-Costa (Malaga/Costa del Sol/Andalucia)