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Fiscal residency

PostPosted: Tue May 07, 2019 10:46 pm
by Jonnno
Are there any other fiscal residents around here? That means u pay ur taxes here but dont want to become resident.

I have been told that I now need a number to be classed as a fiscal resident but I can only get that number by applying for full residency.

Anyone else experienced that?

Re: Fiscal residency

PostPosted: Wed May 08, 2019 4:42 pm
by Paulr
You can't "choose" where you are fiscally resident - it is decided by where you are resident for 183 days (6 months + 1 day) in each tax year. Even if you live in Spain for only 90 days, it's a legal requirement for you to register on the list of Extranjeros (foreigners) and that process is exactly the same as applying for Residencia anyway.

Re: Fiscal residency

PostPosted: Wed May 08, 2019 4:51 pm
by Jonnno
Yes I understand that, but many do choose to stay "under the radar" and dont pay any tax in Spain even tho they are living in Spain virtually full time.

I am specifically hoping to get info from those who do pay tax here cos they spend most of their time here.

Any comment from those who are fiscal residents especially welcome.

Re: Fiscal residency

PostPosted: Wed May 08, 2019 5:02 pm
by marcliff
That would mean you are resident. you can't be a resident for tax purposes but not a resident.

Re: Fiscal residency

PostPosted: Wed May 08, 2019 5:55 pm
by Jonnno
Thats not what my accountant told me 10 years ago

Re: Fiscal residency

PostPosted: Wed May 08, 2019 6:38 pm
by marcliff
If you spend more than 6 months of each year in Spain then you are classed as a resident and liable to Spanish tax on your worldwide income and dual tax agreements come in to play. This is fiscal residency.
If you spend less than 6 months a year in Spain you are classed as a non-resident but are liable for income earned in Spain (for example rental from property). This is non fiscal residency.
In both cases you will need an NIE number which is your tax reference number as well.

To become a fiscal resident you are resident in Spain for 6 months or more each year which is also classed as official residency regardless of whether you go through the official channels to get on the register of EU citizens residing in Spain or not.

I can't see how you can become a fiscal resident in Spain but keep official residency in another country.
Non-fiscal resident, yes, fiscal resident no.

And why would you want to? The tax allowances and bands are nowhere as near as generous as they are in UK.

Re: Fiscal residency

PostPosted: Wed May 08, 2019 6:53 pm
by Red Rock
if you are paying tax in the UK and then apply for Residencia does anyone know how the tax transfers from the UK to Spain - do you start it off with a letter to HMRC?

Re: Fiscal residency

PostPosted: Wed May 08, 2019 6:57 pm
by Jonnno
Are there any other comments? Please note my original post did ask if there were any other fiscal residents. Opinion can be helpful, but I prefer to hear from fiscal residents.

Re: Fiscal residency

PostPosted: Wed May 08, 2019 6:58 pm
by Jonnno
Yes Mike

Re: Fiscal residency

PostPosted: Wed May 08, 2019 7:02 pm
by marcliff
I filled in a P85 and sent it to HMRC with a letter informing them that I would now be resident in Spain.
My non-government pension is now paid free of tax in UK but is liable to tax in Spain. Government pensions are taxed at source and you cannot alter tax paid on those.

If you don't inform the HMRC then you could get hit with a double whammy. Whilst they don't tax your state pension (what we once called the OAP) they do take it into account when assessing the tax on government pensions so you could pay extra tax in UK and then have to pay more tax in Spain on your OAP as it looks like untaxed income.