Do I need to file a tax return if I am not resident?

Does anyone know...?
brownfeet
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Do I need to file a tax return if I am not resident?

Postby brownfeet » 26 Mar 2018 17:39

Just wondering if anyone else files a tax return every year when not resident in Spain?
Our solicitor files a return for each of us and takes a pretty penny for the trouble, we have had our place for 8 years and only used it 10 weeks a year for friends and family so no rental has taken place. Now we are retired, we are looking at our expenses and wonder whether the solicitor is taking money unnecessarily or whether we will be breaking the law if we don't.
After all, we don't file a return in the UK unless we are asked to do so.
We want to do the right thing but if we can spend our money on more interesting things Spanish, so be it!
Many thanks

Aly Gorfa
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Re: Do I need to file a tax return if I am not resident?

Postby Aly Gorfa » 26 Mar 2018 22:19

If you are non resident, you can use 'Spanish tax forms' to do your yearly 210 form. Yes, you have to pay this tax. If you don't, back tax would be recovered if the property is sold or inherited. Google them. It's £30, that covers 2 owners, and you can either let them also pay it for you, or they can send you the forms to pay it yourself. It's extremely simple, they just need a couple of pieces of information from your IBI bill.

When you say that your solicitor charges you a fair bit, it may be that your are actually paying a yearly 'retainer', for help with any problems, not just for completion of your 210.

brownfeet
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Re: Do I need to file a tax return if I am not resident?

Postby brownfeet » 27 Mar 2018 10:25

That is great information, thank you! We also pay him to submit our SUMA so its not a retainer but I know enough now to spend time to minimise the costs. Hopefully this is helpful to others too.
Many thanks

MiGustaAlgorfa
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Re: Do I need to file a tax return if I am not resident?

Postby MiGustaAlgorfa » 27 Mar 2018 16:25

Hi
Talk to someone in your bank. They should be able to set up direct debits for payment of these fees.
I think the non residence tax only goes out every 2 years. Do not be fooled by solicitors it is easy to set up D/Ds and cost nothing extra
Regards

Aly Gorfa
Posts: 169
Joined: 14 May 2015 08:46

Re: Do I need to file a tax return if I am not resident?

Postby Aly Gorfa » 28 Mar 2018 14:29

IBI tax- the equivalent of UK council tax, which is collected by the Suma company, certainly can be set up on DD. Suma also collect car tax and other property taxes, and now for Algorfa, our rubbish bill.

MiGusta, I think you are getting confused with the non resident form, that for some reason banks insist on charging you for, (mine doesn't seem to have charged for a while, or sent me one to complete).

For those of us who own property but only holiday in Spain, we have to pay a yearly non resident tax, it is called 'Renta' , and is an 'assumed letting' tax. It is calculated from info on the IBI bill, and for most people isn't a huge amount. I paid £140 last year, that includes the fee and the company paying it for me.

MiGustaAlgorfa
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Re: Do I need to file a tax return if I am not resident?

Postby MiGustaAlgorfa » 23 Apr 2018 22:37

Hi
Sorry if I miss understood the tax you meant but as a non resident that is the only tax we get charged
The other Suma 'Taxes' I just look on as bill not so much tax. But the same point applies as I said before. Get your bank to get some D/Ds set up for all your regular bills and they should not charge for this. Make sure you have the money in your account and life is so much simpler as well as cheaper than paying solicitors or other outside agencies to do this
Regards

Aly Gorfa
Posts: 169
Joined: 14 May 2015 08:46

Re: Do I need to file a tax return if I am not resident?

Postby Aly Gorfa » 29 Apr 2018 02:00

Sorry MiGusta, I'm still not sure that you understand the non resident tax situation fully?

It might be the way I am reading it. So, for the avoidance of doubt....

You cannot set up a DD for non resident tax. It has to be worked out each year from information on the IBI bill. You can pay a solicitor/accountant/gestor/outside agency to do it for you. Or, if you are tech savvy, you can do it yourself for free on the Hacienda website, it's the 210 form. I believe once completed, you print it off and take it to the bank to pay.

The non resident form the banks charge for every couple of years is just a bit of paper they file which supposedly proves you are non resident as it usually asks for your UK national insurance number, amongst other things.

MiGustaAlgorfa
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Re: Do I need to file a tax return if I am not resident?

Postby MiGustaAlgorfa » 29 Apr 2018 11:01

Hi Aly
I have spoken to quite a few people who own property in Spain and so far I have not come across one who knows anything about this tax !
Very odd I think. Some have said that it only applies to those who intend to rent out their property but as I said no one seems to have heard of it
Most are like me and think the non residency the bank charges every 2 years is this same tax.
I will probably google it later to see what I come up with
Regards

MiGustaAlgorfa
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Re: Do I need to file a tax return if I am not resident?

Postby MiGustaAlgorfa » 29 Apr 2018 13:50

Hi Ali G
Is this the tax you are talking about
Income tax for non-residents who do not rent out their property (standard declaration)
SPANISH NAME Impuesto de la renta de no residentes, declaración ordinaria (IRNR)
DESCRIPTION You pay this version of income tax in Spain if the following conditions apply: 1) You do not reside in Spain, 2) You own property in Spain, 3) The property is exclusively for personal use and you do not rent it out, 4) You have no other source of taxable income in Spain. Although you do not earn an income from the property, in the eyes of the Spanish tax authorities you still derive a benefit from owning a property in Spain and therefore have to pay an imputed income tax.
TAX BASE AND RATE Tax base: 2% of the cadastral value of the property (found on the IBI receipt), or 1.1% if the cadastral value has been revised since 1st January 1994. Tax rate 2016: Residents of EU, Iceland and Norway 19%, all others 24%.
FORM Use general section 210-A and indicating income type 02.
DATES Presented before the 30th June each year. For example you have from 1st January to 30th June 2006 to declare tax on income during 2005.
EXAMPLE Cadastral value of property = 200,000 Euros
Base = 2,200 Euros
Tax = 19% x 2,200 Euros = 418 Euros
As I said I know no one who is aware of this tax so I need to look into it further
Regards

Aly Gorfa
Posts: 169
Joined: 14 May 2015 08:46

Re: Do I need to file a tax return if I am not resident?

Postby Aly Gorfa » 29 Apr 2018 22:54

That's it MiGusta, 'assumed letting' tax. Form 210 at Hacienda.

It does not surprise me that some know nothing about this tax, I see the same reaction on another site I visit. It comes to light when a property is sold or inherited, but it is a relatively small amount.

However, whoever wrote that guide, got the payment dates wrong. It is paid in arrears, and is due by 31st December. (June filing date is tax for residents). So in December last year, I paid my tax for 2016, using my 2016 IBI bill.

If you are non resident and DO let your property out, that is completely different, I think you have to declare three times a year, besides other rules, but let's not complicate matters.


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