Official EU response to the tax question
Aug 17th 2009, 12:51 pm
#1
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Thread Starter
Joined: Aug 2009
Location: Costa Blanca
Posts: 3,143
Official EU response to the tax question
Got involved with another thread last week on the subject of where to declare for income tax (doubtless this is already ringing bells) here is the official EU reply they sent me:
Enquiry posted on
12/08/2009
Enquiry
64982: Subject : Income Tax Question : Does an EU national resident in another EU country have to pay their income tax in that country or can they opt to remain paying income tax in their EU country of origin?
Reply
Dear Mr Innis,
Thank you for your enquiry.
As regards the issue of your taxation status, please be aware that the Citizens Signpost Service cannot advise with authority on income tax issues as these remain governed entirely by national law. We suggest that you obtain written advice by contacting an international tax advisor.
However, we can offer you some general advice on how tax rules work. Income earned (wherever it may be sourced) is usually taxed in your country of residence. You should note that, generally speaking, someone is considered resident for tax purposes where that person spends the majority of their time in any given tax year (ie. more than 183 days). If you spend more than 183 days in any year in Spain you will resident there for tax purposes. You will usually therefore have to pay income tax in Spain.
In the UK, you are considered resident for tax purposes if you spend 90 days or more in the UK.
As a result, in the case where you are considered as resident for tax purposes in Spain and the UK (if you spend 183 or more in Spain and 90 days or more in the UK in any tax year), you would benefit from the provisions of a double taxation Treaty.
Most EU countries have signed a double-taxation treaty, which aims to avoid that individuals and companies are taxed twice on the same income. Such a treaty lay down specific rules to determine residence for taxation purposes for people who spend half the year in one country and the other half in another.
Such a double taxation treaty usually contains rules on determining residence. The country where you are resident for tax purposes (the country in which you pay tax) will be determined as a matter of fact according to objective standards.
Generally speaking, according to similar treaties between EU countries, the country where you are resident for tax purposes is the country with which you have the closest personal connection. This will be determined according to a number of factual indicators such as first where your main permanent home is located, second where you derive your main source of income, third where your spouse/partner and dependents are resident, and finally your nationality.
Spanish tax authorities:
http://www.aeat.es/
UK tax authorities:
http://www.hmrc.gov.uk
As you have left the UK, you need to fill out form P85 and return it to the UK’s HMRC:
www.hmrc.gov.uk/cnr/p85.pdf
The rules allow for any tax deducted in Spain to be deducted from your UK tax bill:
http://www.hmrc.gov.uk/manuals/dtmanual/DT17550+.htm
A similar treaty exists as regards contributions to social security:
http://www.hmrc.gov.uk/international/treatiessocp.htm
You can find out more about tax rules in every EU country from this website:
http://ec.europa.eu/taxation_customs...x/index_en.htm
We hope this answers your query.
Yours sincerely,
Citizens Signpost Service
isclaimer
Advice and information in response to individual enquiries addressed to the Citizens' Signpost Service are provided by independent legal experts under contract with ECAS.
They make every effort to ensure the information and advice they provide is accurate, but do not accept any responsibility or liability for any errors, inaccuracies or omissions.
The European Commission acts as a facilitator of this service and accepts no responsibility or liability with regard to the information or advice provided by this service.
The advice provided by the service does not necessarily reflect the opinion of the European Commission’s various departments and does not bind the European Commission.
Note: To post another enquiry, please visit the Signpost Service Web Site or contact EUROPE DIRECT.
So come on your experts how do you interpret that ?
Enquiry posted on
12/08/2009
Enquiry
64982: Subject : Income Tax Question : Does an EU national resident in another EU country have to pay their income tax in that country or can they opt to remain paying income tax in their EU country of origin?
Reply
Dear Mr Innis,
Thank you for your enquiry.
As regards the issue of your taxation status, please be aware that the Citizens Signpost Service cannot advise with authority on income tax issues as these remain governed entirely by national law. We suggest that you obtain written advice by contacting an international tax advisor.
However, we can offer you some general advice on how tax rules work. Income earned (wherever it may be sourced) is usually taxed in your country of residence. You should note that, generally speaking, someone is considered resident for tax purposes where that person spends the majority of their time in any given tax year (ie. more than 183 days). If you spend more than 183 days in any year in Spain you will resident there for tax purposes. You will usually therefore have to pay income tax in Spain.
In the UK, you are considered resident for tax purposes if you spend 90 days or more in the UK.
As a result, in the case where you are considered as resident for tax purposes in Spain and the UK (if you spend 183 or more in Spain and 90 days or more in the UK in any tax year), you would benefit from the provisions of a double taxation Treaty.
Most EU countries have signed a double-taxation treaty, which aims to avoid that individuals and companies are taxed twice on the same income. Such a treaty lay down specific rules to determine residence for taxation purposes for people who spend half the year in one country and the other half in another.
Such a double taxation treaty usually contains rules on determining residence. The country where you are resident for tax purposes (the country in which you pay tax) will be determined as a matter of fact according to objective standards.
Generally speaking, according to similar treaties between EU countries, the country where you are resident for tax purposes is the country with which you have the closest personal connection. This will be determined according to a number of factual indicators such as first where your main permanent home is located, second where you derive your main source of income, third where your spouse/partner and dependents are resident, and finally your nationality.
Spanish tax authorities:
http://www.aeat.es/
UK tax authorities:
http://www.hmrc.gov.uk
As you have left the UK, you need to fill out form P85 and return it to the UK’s HMRC:
www.hmrc.gov.uk/cnr/p85.pdf
The rules allow for any tax deducted in Spain to be deducted from your UK tax bill:
http://www.hmrc.gov.uk/manuals/dtmanual/DT17550+.htm
A similar treaty exists as regards contributions to social security:
http://www.hmrc.gov.uk/international/treatiessocp.htm
You can find out more about tax rules in every EU country from this website:
http://ec.europa.eu/taxation_customs...x/index_en.htm
We hope this answers your query.
Yours sincerely,
Citizens Signpost Service
isclaimer
Advice and information in response to individual enquiries addressed to the Citizens' Signpost Service are provided by independent legal experts under contract with ECAS.
They make every effort to ensure the information and advice they provide is accurate, but do not accept any responsibility or liability for any errors, inaccuracies or omissions.
The European Commission acts as a facilitator of this service and accepts no responsibility or liability with regard to the information or advice provided by this service.
The advice provided by the service does not necessarily reflect the opinion of the European Commission’s various departments and does not bind the European Commission.
Note: To post another enquiry, please visit the Signpost Service Web Site or contact EUROPE DIRECT.
So come on your experts how do you interpret that ?
Last edited by Mitzyboy; Aug 19th 2009 at 2:46 pm.
Aug 17th 2009, 12:55 pm
#2
Senior Moment
Joined: Jan 2006
Location: On the edge
Posts: 20,460
Re: Official EU response to the tax question
More or less no differently to how we have always interpreted it 
Aug 17th 2009, 12:55 pm
#3
RETIRED ;-))
Joined: Jul 2003
Location: Benalmadena Pueblo,Spain
Posts: 20,156
Re: Official EU response to the tax question
Got involved with another thread last week on the subject of where to declare for income tax (doubtless this is already ringing bells) here is the official EU reply they sent me:
Enquiry posted on
12/08/2009
Enquiry
64982: Subject : Income Tax Question : Does an EU national resident in another EU country have to pay their income tax in that country or can they opt to remain paying income tax in their EU country of origin?
Reply
Dear Mr Innis,
Thank you for your enquiry.
As regards the issue of your taxation status, please be aware that the Citizens Signpost Service cannot advise with authority on income tax issues as these remain governed entirely by national law. We suggest that you obtain written advice by contacting an international tax advisor.
However, we can offer you some general advice on how tax rules work. Income earned (wherever it may be sourced) is usually taxed in your country of residence. You should note that, generally speaking, someone is considered resident for tax purposes where that person spends the majority of their time in any given tax year (ie. more than 183 days). If you spend more than 183 days in any year in Spain you will resident there for tax purposes. You will usually therefore have to pay income tax in Spain.
In the UK, you are considered resident for tax purposes if you spend 90 days or more in the UK.
As a result, in the case where you are considered as resident for tax purposes in Spain and the UK (if you spend 183 or more in Spain and 90 days or more in the UK in any tax year), you would benefit from the provisions of a double taxation Treaty.
Most EU countries have signed a double-taxation treaty, which aims to avoid that individuals and companies are taxed twice on the same income. Such a treaty lay down specific rules to determine residence for taxation purposes for people who spend half the year in one country and the other half in another.
Such a double taxation treaty usually contains rules on determining residence. The country where you are resident for tax purposes (the country in which you pay tax) will be determined as a matter of fact according to objective standards.
Generally speaking, according to similar treaties between EU countries, the country where you are resident for tax purposes is the country with which you have the closest personal connection. This will be determined according to a number of factual indicators such as first where your main permanent home is located, second where you derive your main source of income, third where your spouse/partner and dependents are resident, and finally your nationality.
Spanish tax authorities:
http://www.aeat.es/
UK tax authorities:
http://www.hmrc.gov.uk
As you have left the UK, you need to fill out form P85 and return it to the UK’s HMRC:
www.hmrc.gov.uk/cnr/p85.pdf
The rules allow for any tax deducted in Spain to be deducted from your UK tax bill:
http://www.hmrc.gov.uk/manuals/dtmanual/DT17550+.htm
A similar treaty exists as regards contributions to social security:
http://www.hmrc.gov.uk/international/treatiessocp.htm
You can find out more about tax rules in every EU country from this website:
http://ec.europa.eu/taxation_customs...x/index_en.htm
We hope this answers your query.
Yours sincerely,
Citizens Signpost Service
Note: To post another enquiry, please visit the Signpost Service Web Site or contact EUROPE DIRECT.
So come on your experts how do you interpret that ?
Enquiry posted on
12/08/2009
Enquiry
64982: Subject : Income Tax Question : Does an EU national resident in another EU country have to pay their income tax in that country or can they opt to remain paying income tax in their EU country of origin?
Reply
Dear Mr Innis,
Thank you for your enquiry.
As regards the issue of your taxation status, please be aware that the Citizens Signpost Service cannot advise with authority on income tax issues as these remain governed entirely by national law. We suggest that you obtain written advice by contacting an international tax advisor.
However, we can offer you some general advice on how tax rules work. Income earned (wherever it may be sourced) is usually taxed in your country of residence. You should note that, generally speaking, someone is considered resident for tax purposes where that person spends the majority of their time in any given tax year (ie. more than 183 days). If you spend more than 183 days in any year in Spain you will resident there for tax purposes. You will usually therefore have to pay income tax in Spain.
In the UK, you are considered resident for tax purposes if you spend 90 days or more in the UK.
As a result, in the case where you are considered as resident for tax purposes in Spain and the UK (if you spend 183 or more in Spain and 90 days or more in the UK in any tax year), you would benefit from the provisions of a double taxation Treaty.
Most EU countries have signed a double-taxation treaty, which aims to avoid that individuals and companies are taxed twice on the same income. Such a treaty lay down specific rules to determine residence for taxation purposes for people who spend half the year in one country and the other half in another.
Such a double taxation treaty usually contains rules on determining residence. The country where you are resident for tax purposes (the country in which you pay tax) will be determined as a matter of fact according to objective standards.
Generally speaking, according to similar treaties between EU countries, the country where you are resident for tax purposes is the country with which you have the closest personal connection. This will be determined according to a number of factual indicators such as first where your main permanent home is located, second where you derive your main source of income, third where your spouse/partner and dependents are resident, and finally your nationality.
Spanish tax authorities:
http://www.aeat.es/
UK tax authorities:
http://www.hmrc.gov.uk
As you have left the UK, you need to fill out form P85 and return it to the UK’s HMRC:
www.hmrc.gov.uk/cnr/p85.pdf
The rules allow for any tax deducted in Spain to be deducted from your UK tax bill:
http://www.hmrc.gov.uk/manuals/dtmanual/DT17550+.htm
A similar treaty exists as regards contributions to social security:
http://www.hmrc.gov.uk/international/treatiessocp.htm
You can find out more about tax rules in every EU country from this website:
http://ec.europa.eu/taxation_customs...x/index_en.htm
We hope this answers your query.
Yours sincerely,
Citizens Signpost Service
Note: To post another enquiry, please visit the Signpost Service Web Site or contact EUROPE DIRECT.
So come on your experts how do you interpret that ?
Aug 17th 2009, 1:04 pm
#5
RETIRED ;-))
Joined: Jul 2003
Location: Benalmadena Pueblo,Spain
Posts: 20,156
