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My daughter moved here last July, she works for a British company who pay her wages into her U.K. bank account. Can anyone tell me when she will need to start paying tax here and how much is she allowed to earn before she will have to pay tax and is it worked out from her gross pay or net pay? . She is a res
Posted: Wed Mar 24, 2021 3:53pm
Helpful member
There are a number of variables at play here which make it dificult to answer without knowing more:
(i) Is your daughter now resident in Spain? Does she have private healthcare insurance?
(ii) did the British company know of her change of location and agree it?
(iii) presumably she is still paying employee NI/tax based on her UK salary to the UK Treasury?
Spanish tax residence - broadly speaking - is based on the number of days spent here in a calendar year exceeding 183. So for calendar year 2021 she should be paying tax into the Spanish system (as should the employer)?
If the company is not aware of the move, then you potentially I think end up in a very messy situation both with regards to income tax and also national insurance?
Posted: Wed Mar 24, 2021 7:34pm
Super helpful member
If she gained Residency last July, she is tax-resident in Spain wef 1/1/21.
She will need to submit her modelo 720 in Feb 22.
She will submit her income tax return (for Jan-Dec 21) in June 22.
She will pay her income tax (for Jan-Dec 21) in 2 chunks ... June and September 22.
In October 22 she can request release from the UK tax system. This may take 6 months to achieve.
Note ... she will continue paying PAYE in the UK until she is released from the UK system. She will pay tax in Spain AND in the UK for a period of time (2 years and counting in my case). There is a cash-flow pinch point to be managed,.
In general, more income tax is paid in Spain than in the UK. Allowances are lower and rates are higher.
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Kelvin1960 wrote on Wed Mar 24, 2021 7:34pm:
If she gained Residency last July, she is tax-resident in Spain wef 1/1/21.
She will need to submit her modelo 720 in Feb 22.
Read more...
She will submit her income tax return (for Jan-Dec 21) in June 22.
She will pay her income tax (for Jan-Dec 21) in 2 chunks ... June and September 22.
In October 22 she can request release from the UK tax system. This may take 6 months to achieve.
Note ... she will continue paying PAYE in the UK until she is released from the UK system. She will pay tax in Spain AND in the UK for a period of time (2 years and counting in my case). There is a cash-flow pinch point to be managed,.
In general, more income tax is paid in Spain than in the UK. Allowances are lower and rates are higher.
She was accepted for her TIE In December 2020 but has not yet been notified that she can collect it, will this make a difference as to when she starts paying tax here?
Posted: Wed Mar 24, 2021 8:00pm
Super helpful member
Shelagh1 wrote on Wed Mar 24, 2021 7:49pm:
She was accepted for her TIE In December 2020 but has not yet been notified that she can collect it, will this make a difference as to when she starts paying tax here?
Probably not.
The dates I quoted above apply to granting of Residencia/TIE from July 20 to June 21.
Afternoon
I’m told I need to pay none resident taxes and need copies of previous suma bills
Does anybody have some advice and an email for my local suma authority?
Regards
