Questions about Modelo 720 and tax residency
Jan 11th 2018, 6:22 pm
#16
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Re: Questions about Modelo 720 and tax residency
What's a gestoria?
Also, do you know what would happen if:
a) I left Spain before 31/03/18 - would I still need to do the modelo?
b) if I stay longer but return to the UK in, say, September, would I need to do a Modelo next year from the UK as I would have been in Spain the majority of this year?
Sorry for all the questions and thank you for your patient responses.
Also, do you know what would happen if:
a) I left Spain before 31/03/18 - would I still need to do the modelo?
b) if I stay longer but return to the UK in, say, September, would I need to do a Modelo next year from the UK as I would have been in Spain the majority of this year?
Sorry for all the questions and thank you for your patient responses.
You do not need to worry about the Modelo 720 , at the moment it is an exercise in information gathering there is no tax to pay when it is submitted. It simply gives the tax authorities an overview of what you have and where it is. Typical example of a bureaucratic exercise designed to "flush out" offshore funds , which of course it will never do as only honest people worry about filling it out.
Once you leave Spain , provided you go to a country that has a double-taxation agreement with Spain, e.g. the UK your tax liability in Spain will end. If you stay until September in Spain you will need to do a tax declaration for the months you were there.
Jan 11th 2018, 6:29 pm
#17
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Re: Questions about Modelo 720 and tax residency
A gestoria is a general "Fix it" agent . The larger ones do such things as residence papers, tax returns, driving licence applications etc etc . Anything that needs to be done with the public administration which you find too difficult or too boring to do. You can find one easily on the web. Just search with your town and the word "gestoria"
You do not need to worry about the Modelo 720 , at the moment it is an exercise in information gathering there is no tax to pay when it is submitted. It simply gives the tax authorities an overview of what you have and where it is. Typical example of a bureaucratic exercise designed to "flush out" offshore funds , which of course it will never do as only honest people worry about filling it out.
Once you leave Spain , provided you go to a country that has a double-taxation agreement with Spain, e.g. the UK your tax liability in Spain will end. If you stay until September in Spain you will need to do a tax declaration for the months you were there.
You do not need to worry about the Modelo 720 , at the moment it is an exercise in information gathering there is no tax to pay when it is submitted. It simply gives the tax authorities an overview of what you have and where it is. Typical example of a bureaucratic exercise designed to "flush out" offshore funds , which of course it will never do as only honest people worry about filling it out.
Once you leave Spain , provided you go to a country that has a double-taxation agreement with Spain, e.g. the UK your tax liability in Spain will end. If you stay until September in Spain you will need to do a tax declaration for the months you were there.
I'm more worried about the penalties etc if I don't do it in time or there are any incorrect details really! But I appreciate the words, I feel better about it.
Just to clarify your last point, do you mean I'd have to do Modelo 720 again or just a general tax return? I get taxed directly from my wages at work, so presumed I wouldn't have to do tax returns as well...
Jan 11th 2018, 6:35 pm
#18
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Re: Questions about Modelo 720 and tax residency
Ah thank you - I'll have a look at gestorias then.
I'm more worried about the penalties etc if I don't do it in time or there are any incorrect details really! But I appreciate the words, I feel better about it.
Just to clarify your last point, do you mean I'd have to do Modelo 720 again or just a general tax return? I get taxed directly from my wages at work, so presumed I wouldn't have to do tax returns as well...
I'm more worried about the penalties etc if I don't do it in time or there are any incorrect details really! But I appreciate the words, I feel better about it.
Just to clarify your last point, do you mean I'd have to do Modelo 720 again or just a general tax return? I get taxed directly from my wages at work, so presumed I wouldn't have to do tax returns as well...
I do not think a new Modelo 720 will be necessary only the income tax return.
Jan 11th 2018, 6:38 pm
#19
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Re: Questions about Modelo 720 and tax residency
Even though you are taxed at source unless your income is below the minimum threshold you are responsible for filing your own tax return in Spain. The tax authorities may make available online a draft for you to look at but even then you have to approve it before it is officially submitted.
I do not think a new Modelo 720 will be necessary only the income tax return.
I do not think a new Modelo 720 will be necessary only the income tax return.
Last edited by Maxwellhouseeyes; Jan 11th 2018 at 6:38 pm. Reason: Missed close bracket
Jan 11th 2018, 7:19 pm
#20
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Re: Questions about Modelo 720 and tax residency
It's €11,000 per person or thereabout but presume if you work less than a full year you will be below it. Look on the bright side maybe they have deducted tax every month on a full year's earnings so you could get a rebate.
Jan 11th 2018, 9:16 pm
#21
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Re: Questions about Modelo 720 and tax residency
No, it’s 22k if you have tax deducted at source (paye)
Jan 11th 2018, 9:18 pm
#22
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Re: Questions about Modelo 720 and tax residency
Jan 13th 2018, 10:01 am
#23
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Re: Questions about Modelo 720 and tax residency
Hi again guys, sorry to bother you.
I have spoken to a couple of accountants and gestors who tell me I won't need to submit Modelo 720 because I signed my job contract under 6 months ago. I'm still worried though, that if I go along with this and the tax office DO deem me a tax resident, that I will be caught out and have to pay the huge fines.
Does anyone know any more on this, or of anyone who is an expert in this kind of thing? If I arrange a meeting with Agencia Tributaria do you think they would be able to tell me? I could do with getting it officially in writing to reassure me that I don't need to do it...
I have spoken to a couple of accountants and gestors who tell me I won't need to submit Modelo 720 because I signed my job contract under 6 months ago. I'm still worried though, that if I go along with this and the tax office DO deem me a tax resident, that I will be caught out and have to pay the huge fines.
Does anyone know any more on this, or of anyone who is an expert in this kind of thing? If I arrange a meeting with Agencia Tributaria do you think they would be able to tell me? I could do with getting it officially in writing to reassure me that I don't need to do it...
Jan 13th 2018, 10:04 am
#24
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Jan 13th 2018, 11:45 am
#25
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Re: Questions about Modelo 720 and tax residency
Hi again guys, sorry to bother you.
I have spoken to a couple of accountants and gestors who tell me I won't need to submit Modelo 720 because I signed my job contract under 6 months ago. I'm still worried though, that if I go along with this and the tax office DO deem me a tax resident, that I will be caught out and have to pay the huge fines.
Does anyone know any more on this, or of anyone who is an expert in this kind of thing? If I arrange a meeting with Agencia Tributaria do you think they would be able to tell me? I could do with getting it officially in writing to reassure me that I don't need to do it...
I have spoken to a couple of accountants and gestors who tell me I won't need to submit Modelo 720 because I signed my job contract under 6 months ago. I'm still worried though, that if I go along with this and the tax office DO deem me a tax resident, that I will be caught out and have to pay the huge fines.
Does anyone know any more on this, or of anyone who is an expert in this kind of thing? If I arrange a meeting with Agencia Tributaria do you think they would be able to tell me? I could do with getting it officially in writing to reassure me that I don't need to do it...
Tha advice from the Gestors seems logical. The 720 to be done this year refers to your assets in 2017 when you wouldn't have been a tax resident. If you stay in Spain you will have to do one in 2019.
I think this fines business has been overblown. The European court are looking into the legality of it and we don't hear about fines being imposed on the various politicians who are discovered to have undeclared accounts in Andorra and Switzerland. It was all a money-spinner for the Gestoria industry
Jan 13th 2018, 12:30 pm
#26
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Re: Questions about Modelo 720 and tax residency
Tha advice from the Gestors seems logical. The 720 to be done this year refers to your assets in 2017 when you wouldn't have been a tax resident. If you stay in Spain you will have to do one in 2019.
I think this fines business has been overblown. The European court are looking into the legality of it and we don't hear about fines being imposed on the various politicians who are discovered to have undeclared accounts in Andorra and Switzerland. It was all a money-spinner for the Gestoria industry
I think this fines business has been overblown. The European court are looking into the legality of it and we don't hear about fines being imposed on the various politicians who are discovered to have undeclared accounts in Andorra and Switzerland. It was all a money-spinner for the Gestoria industry
Jan 13th 2018, 12:44 pm
#27
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Re: Questions about Modelo 720 and tax residency
As he came in August he spent less than 183 days here. I suspect he has been paying tax at a very low level. It used to be 2% for English teachers and everything is then sorted in the Declaración the following year. He may well get a rebate.
Jan 13th 2018, 1:08 pm
#28
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Re: Questions about Modelo 720 and tax residency
I'm just a bit of a catastrophiser and am easily swayed by the stuff I've read online about the penalties, even if it is scaremongering!
The 183 day rule seems to take precedent in most of the articles I've seen, but there's still this point of having 'economic interest or activity' in Spain which I don't quite understand.
Jan 13th 2018, 1:14 pm
#29
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Re: Questions about Modelo 720 and tax residency
Yes, as far as I know I haven't been paying the normal income tax rate of ~20% or thereabouts. It has been more like 2% from what I can see.
I'm just a bit of a catastrophiser and am easily swayed by the stuff I've read online about the penalties, even if it is scaremongering!
The 183 day rule seems to take precedent in most of the articles I've seen, but there's still this point of having 'economic interest or activity' in Spain which I don't quite understand.
I'm just a bit of a catastrophiser and am easily swayed by the stuff I've read online about the penalties, even if it is scaremongering!
The 183 day rule seems to take precedent in most of the articles I've seen, but there's still this point of having 'economic interest or activity' in Spain which I don't quite understand.
There are three broad criteria used to define fiscal residence :
1. The 183 day time definition
2. Centre of economic interest - employment, house ownership, main bank account etc etc
3. When the other family members , wife and children live in Spain.
Jan 13th 2018, 1:56 pm
#30
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Re: Questions about Modelo 720 and tax residency
Yeah it's point 2 which gets me, but the accountants/gestors I've spoken to seem to just ignore this. I wish I could just email the Agencia to ask, or check online or something, but it doesn't seem possible. I hate having the responsibility on me!