Taxes Payable On Second Home In Spain

If the only income you get is your crown pension then why are you paying tax in Spain at all? It is covered under the dual tax agreement with UK and is only taxable in the country of origin. The only things you would be liable to pay tax on would be the state pension (which you don't get yet) interest from savings accounts, shares etc or rent from properties.

But if your only income is you crown pension then you shouldn't be paying any income tax in Spain at all.

Thanks marcliff. I am paying tax because my solicitor said that, based on my income and circumstances, I needed to make a tax return. I gave them all my documents, and then I got a tax bill (two in fact, one for for 2021 and now one for 2022).

I took legal advice here. Am I now right in thinking my Mondelo form was completed incorrectly, and that the Tax requested from me is wrong?

Receiving a crown pension does not necessarily absolve you from submitting tax returns.

You declare your income gross which allows the Spanish tax man to determine your liability in Spain and from that is deducted what tax you had paid in UK.

Because The Spanish system is not as generous as UKs it can result in you paying additional tax here.

Yes, your crown pension is not taxable in Spain and you should not be paying tax on it. 

If your pension is one of those listed as Government on this link https://www.gov.uk/hmrc-internal-manuals/international-manual/intm343040

then it goes on the tax return as non taxable income. The only time it affects tax in Spain is if you are receiving other income (and you say you are not) to assess the level of tax you pay. 

This has happened to quite a few people where the person doing the return has declared it as "UK pension annuity" which is taxable in Spain. The correct box used to be 470 (I haven't done my own tax return for many years when my incomes started getting a bit complicated) for Crown pension which are not taxable in Spain. 

Maybe change your gestor.

Two different answers to the same question.

Is it any wonder confusion arises?

According to that link, I should not be paying Spanish tax on my UK Crown Pension. I thought that maybe I was paying the balance on the difference between UK tax and the tax due in Spain. But no.

And how do I find a gestor that knows all the answers (as I thought I had a gestor that did)?

I waited until after 4 when my solicitors got back from the siesta.

I asked how my tax charges were worked out this year and they told me that my Army pension is not taxed at all in Spain under the dual tax treatment but it does use up the Spanish tax allowance and the lower tax bands of 19 and 24 percent. Therefore my state pension, private pension and bank interest attract income tax at the rate of 30% but they explained that the Army pension is not taxed, just used up the allowances.

Checking the amount I receive but less the Army pension completely, I am paying just under 30% tax on all my other income (works out at 28.7%) but I think some extra allowances were added by the Valencia community this year and it is, actually, about 300 euros less than I paid last year. But they did confirm no tax was taken from my Army pension. 

A quick back of the fag packet bit of sums and, if it had and removing all the Spanish allowances, my tax bill would be another 7 or 8 hundred more.

However, looking at the websites of two sets of solicitors in Spain, one states that, depending on the agreement, your Crown pension could attract the difference in tax you paid in your home country and what you would have paid in Spain.

Another says that for UK Crown pensions, they are not taxed in Spain but are taken into account for the tax free allowance and the rate at which tax is deducted.

So two online solicitors and both giving different advice. I'm sticking to my solicitors version.

Even though you receive no rental income from the family holiday home, you will be due to pay imputed tax on your 5th share, and your siblings the other 80%.

Perhaps you are paying imputed tax on the whole of the property. (imputed tax because the property is empty, but is, theoretically, available to be let)

I now own a garage space in a building that is not where I live, and I was surprised to learn that I have to pay imputed tax on that this year.

We have had the family house for 12 years or so, and my siblings pay the non-resident tax on it (as did I until I became resident). I did expect to pay more for the house once I got my TIE, so no surprise there.

I have a Civil Service pension which, according to gov.uk website the dual tax agreement between UK and Spain means I should not pay tax on it (and it is not a big pension).

It seems (so far) that there is a big discrepancy on what accountants and solicitors here say, and what I hear from others.

Hi i would advise you to contact the following company who speak English and do my annual tax return (I have a UK gov pension) .As a resident you are obligated to submit a tax return by end of June and complete a form 720 with any worldwide assets in March. Iam sure they will advise you over the phone. They charge 90 Euro for a tax return and more if you have rental income etc.