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hi there, hope all is well. I arrived into Spain on the 8th of August 2020, can anyone please advise when I should start to pay tax from my salary here in Spain? I will still be employed by a UK company but they will pay my full gross salary so I can then pay my own taxes here in Spain. Would it be February 8th 2021 as this is 183 days and 6 months or is it 183 days of 2021 which means June 2021?
Posted: Thu Dec 17, 2020 5:19pm
Super helpful member
Have you been granted Residencia TIE yet ? This is the starting point.
Spain's tax year is 1 Jan-31 Dec.
We were granted Residencia in Aug 2018, so we became liable for income tax in Spain on 1/1/19.
We submitted our Modelo 720 forms (declaration of worldwide assets) in Feb 2020. We submitted our income tax return (we "reconciled" tax) for Jan-Dec 2019 in June 2020. We paid the Jan-Dec 2019 tax in 2 chunks ... June and November 2020.
If you gain Residencia/TIE in period Jan-June, you reconcile the following year.
If you gain Residencia/TIE in period July-December, you reconcile a year later.
It has been suggested that the date of your padron (usually before Residencia/TIE) can be applied by the Spanish tax authorities as the starting point, but I don't know anyone who has experienced this.
You have to pay your Spanish income tax before you claim back UK income tax for the same period. We are still paying tax PAYE in the UK. We have applied to receive our tax (since 1/1/19) from the UK, but we have not received it yet. This seems to be quite normal.
So beware, there is a tax cashflow pinch-point to plan for.
Kelvin1960 wrote on Thu Dec 17, 2020 5:19pm:
Have you been granted Residencia TIE yet ? This is the starting point.
Spain's tax year is 1 Jan-31 Dec.
Read more...
We were granted Residencia in Aug 2018, so we became liable for income tax in Spain on 1/1/19.
We submitted our Modelo 720 forms (declaration of worldwide assets) in Feb 2020. We submitted our income tax return (we "reconciled" tax) for Jan-Dec 2019 in June 2020. We paid the Jan-Dec 2019 tax in 2 chunks ... June and November 2020.
If you gain Residencia/TIE in period Jan-June, you reconcile the following year.
If you gain Residencia/TIE in period July-December, you reconcile a year later.
It has been suggested that the date of your padron (usually before Residencia/TIE) can be applied by the Spanish tax authorities as the starting point, but I don't know anyone who has experienced this.
You have to pay your Spanish income tax before you claim back UK income tax for the same period. We are still paying tax PAYE in the UK. We have applied to receive our tax (since 1/1/19) from the UK, but we have not received it yet. This seems to be quite normal.
So beware, there is a tax cashflow pinch-point to plan for.
Many thanks for you reply.
Not yet but , all registered online and had resolutions but need to go to Alicante in January to the police station there with photos etc to get my residency
Would you say I need to start paying Spanish tax shortly? and paying UK tax at the same time?
Posted: Thu Dec 17, 2020 6:33pm
Super helpful member
Nick83 wrote on Thu Dec 17, 2020 5:31pm:
Many thanks for you reply.
Not yet but , all registered online and had resolutions but need to go to Alicante in January to the police station there with photos etc to get my residency
Read more...
Would you say I need to start paying Spanish tax shortly? and paying UK tax at the same time?
I can only answer based on my own experience.
Assuming you gain Residency/TIE in the first half of 2021 ...
- you will submit your Modelo 720 in Feb 22
- you will submit your income tax declaration in June 22 (for tax year Jan-Dec 21)
- you will pay your tax in Spain (Jan-Dec 21) in 2 chunks ... in June and Nov 2022.
- you will continue paying tax in the UK PAYE
- you will apply for a refund from the UK (for tax paid in the UK from 1/1/21) in Oct 22
- you will get this money returned from the UK on ????? (we haven't received ours yet)
Suggest you get a gestor to confirm this.
Best wishes.
