Non Resident Tax Spain 2018?

Non Resident Tax Spain 2018
Spanish taxes for non-residents – The general flat income tax rate for non-residents is 24%, or 19% if you are a citizen of a country in the European Union or the European Economic Area. Other income is subject to Spanish non-resident taxes at the following rates:

Capital gains resulting from transferred assets are taxed at a rate of 19%.
Investment interest and dividends are taxed at 19%, although are typically lower through double taxation agreements. Interest tax is exempt for EU citizens.
Royalties are taxed at 24%.
Pensions are taxed at progressive rates, from 8% to 40%.

To apply to pay income tax as a non-resident of Spain, first obtain Modelo 149. Next, use the Modelo 150 form to make your income tax declaration. If you are a non-resident property owner, you should make your tax declaration on Modelo 210.

What is the tax rate in Spain for non residents?

Taxes in Spain for non-residents – Let’s talk about Spanish taxes fr expats: rates, deadlines, reporting, allowances you can use and most importantly the difference between being resident and non-resident. If you live in Spain for less than six months (183 days) in a calendar year, you are classed as a non-resident.

In this case, you will only pay taxes on income earned in Spain. For example, you will be taxed in Spain if you have a property in Spain that you rent out, a savings account, or any other assets that earn you income.

Your Spanish income will be taxed at flat rates with no allowances or deductions. The rates are 24%, or 19% if you are a citizen of an EU/EEA state. Non-residents who have a property in Spain must submit a tax return and pay a property tax for non-residents.

What is nriit tax in Spain?

Non-Resident Imputed Income Tax (NRIIT) – Long story short, you only pay this tax once a year, on or before the end of December. This tax applies nationwide in Spain. All non-residents owning property in Spain need to file once a year this testimonial tax.

Even if you do NOT rent out your property in Spain you still need to pay it;
Also, if you do rent out the property part time during the year, on the days you do not rent out your property in Spain these are taxed as imputed income on a pro rata;

Basically, this tax is a legal fiction whereby it is surmised that you derive some form of financial benefit (income) from your Spanish home; that is why it is called non-resident imputed income tax, as it is deemed income. Spanish Tax Authorities take the view an owner derives a benefit in kind from owning property, irrespective of whether it is true or not, and taxes it accordingly.

When is it filed? Once a year, before end of December of the following year;
For 2018 we are filing the tax corresponding to the previous year (2017);
We are accepting filing this tax until the 20 th of December;

We advise you file this yearly tax as soon as possible to avoid end-of-year bottlenecks. In fact, you should start filing it now in October to pre-empt any issues. Tax rates: The imputed ‘income’ is assessed as 1. 1% or 2% of the cadastral value. Tax rate is applied on this amount.

Can a non-resident rent out a property in Spain?

Non resident tax Spain explained – Taxes are a fact of life and we expect to pay them in the country where we live. However, what about when you have a property in another country but don’t live there? Most people recognise that there is likely to be some form of property tax that contributes to the cost of the services that the property depends on. IBI council tax The IBI is collected once a year, although the timing varies according to which town the property is located in. The amount you have to pay usually compares well with that of council tax in other countries. It is certainly not exorbitant and is used for the maintenance of many facilities that those spending time in Spain, depend on. This tax is paid directly to the town hall or the SUMA offices and is based upon the rateable value of your property or valor catastral.

In Spain this is called the IBI (Impuesto Sobre Bienes Inmuebles) and is a form of council tax, similar to that levied in other countries. What often takes non-resident Spanish property owners by surprise is the existence of another property ‘income’ tax.

Imputed income tax is an additional tax that non-resident home-owners are required to pay if they do not rent out their property. Imputed income tax If you are a non-resident with a property in Spain then it is considered to be your second home. As such you may rent it out, as many do, or simply use it as a holiday home when you choose. If you decide to rent it out, then you must pay rental tax on the income you make. However, if you don’t rent it out then you still have an additional tax to pay; imputed income tax.

After all, you could rent it out if you wished. The obligation to pay imputed income tax has sometimes been missed by non-resident owners. Unused to the practice in their own country, people are often surprised to hear that they must pay an income tax in the country they visit rather than reside in.

However, as with most Spanish taxes, if you do not keep up with the payments you may well find that these are logged against your property and cause problems when you wish to sell or it is passed on to your inheritors. If you rent out your property for only part of the year then you will pay rental tax at these times and a proportion of the imputed income tax for the months when the property is not rented out. Rental tax If you rent out your property than you must pay rental income. This is calculated on a quarterly basis:

First quarter, 20 th April (January, February, March)
Second quarter, 20 th July (April, May, June)
Third quarter, 20 th October (July, August, September)
Fourth quarter, 20 th January (October, November, December)

There are allowances for some expenses such as:

House insurance
IBI
The community fee
Property repairs
Cleaning
Property management fees

You can also claim for water and electricity charges where the owner rather than the tenant, pays for them. You should note, however, that you can only claim expenses against rental income if you are a resident of the EU, Norway or Iceland. We are often asked if you must also declare this income in your home country. If you are British, for example, you must declare the income in Britain, but the double taxation agreement means that you don’t have to pay twice. Keep your taxes in order Buying a property in Spain comes with tax implications. Some of these, such as imputed income tax, can be difficult to understand and are different to what many people are used to in their home country. To avoid complications with non resident tax in Spain or when selling or bequeathing your property, we recommend that you engage an independent tax adviser.

In order to make sure that you are tax compliant you must make a non-resident tax declaration at the end of each year, before December 31 st;
Instead the tax you have paid in Spain is deducted from the amount you would have to pay in Britain;

What is imputed income tax on property in Spain?

In this case, you will only pay taxes on income earned in Spain. For example, you will be taxed in Spain if you have a property in Spain that you rent out, a savings account, or any other assets that earn you income.