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Self employed uk resident working in spain
Hello.
I started working in spain 10 years ago with uk self employed resident status. i also have some work in uk and belgium. I have tried to keep my tax residence in the uk according to the double taxation treaty, and spend on average 90 days per year in the uk. I have a fixed abode in the uk and a rental in madrid. My uk clients pay into uk bank and spanish clients into spanish account. Every year the UK IR sends me the required tax residency certificate after i do my return. Everything has been going fine, until one of my spanish accounts, cajamadrid, was frozen, saying i have to present the non residents cert. They said my cert from uk, and written in accordance to the treaty, isnt good enough. They said i have to get a spanish one, however my other banks do this for me for a small fee. They also said i should have a NIE. I dont have a NIE and dont want one. I have closed the bank account in question. My question is, am i doing right or has something changed? I always thought the NIE isnt absolutely compulsary, unless one wants to be resident in spain, and just allows the spanish to track you more easily. (got nothing to hide) I would appreciate your reassurance and guidance. Many thanx. Twb |
Re: Self employed uk resident working in spain
Originally Posted by twbag
(Post 9187093)
Hello.
I started working in spain 10 years ago with uk self employed resident status. i also have some work in uk and belgium. I have tried to keep my tax residence in the uk according to the double taxation treaty, and spend on average 90 days per year in the uk. I have a fixed abode in the uk and a rental in madrid. My uk clients pay into uk bank and spanish clients into spanish account. Every year the UK IR sends me the required tax residency certificate after i do my return. Everything has been going fine, until one of my spanish accounts, cajamadrid, was frozen, saying i have to present the non residents cert. They said my cert from uk, and written in accordance to the treaty, isnt good enough. They said i have to get a spanish one, however my other banks do this for me for a small fee. They also said i should have a NIE. I dont have a NIE and dont want one. I have closed the bank account in question. My question is, am i doing right or has something changed? I always thought the NIE isnt absolutely compulsary, unless one wants to be resident in spain, and just allows the spanish to track you more easily. (got nothing to hide) I would appreciate your reassurance and guidance. Many thanx. Twb |
Re: Self employed uk resident working in spain
Hello. thanks for quick reply on Saturday...:)
Yes. thanks. But the question is, Is it compulsory and can I just continue as I am? I would prefer not to have to register for NIE or get this CERT. Don't mind if bank will do it. 15eur/2years isnt too bad. It would cost me more if I have to lose time... Havent had any probs renting privately or with anything, they just require a large deposit and bank guarantee Happy wk/end :) |
Re: Self employed uk resident working in spain
The key question that needs to be answered is how much time do you spend in Spain?
If you spend more than 90 days consecutively in Spain you must register on the foreigners register and that will give you an NIE whether you want one or not. This does not affect your tax residency. If you spend more than 183 days in Spain (not necessarily consecutively) in one calendar year you will deemed to be tax resident in Spain. The fact that you are tax resident in the UK under their 90 day rule does not affect this - it is possible to be tax resident in both countries but Spain will have the primary claim if you are tax resident in Spain. |
Re: Self employed uk resident working in spain
Originally Posted by twbag
(Post 9187142)
Hello. thanks for quick reply on Saturday...:)
Yes. thanks. But the question is, Is it compulsory and can I just continue as I am? I would prefer not to have to register for NIE or get this CERT. Don't mind if bank will do it. 15eur/2years isnt too bad. It would cost me more if I have to lose time... Havent had any probs renting privately or with anything, they just require a large deposit and bank guarantee Happy wk/end :) Get a euro account with a UK bank and get your clients to make payment to that account.:thumbsup:Be the grey man:thumbsup: |
Re: Self employed uk resident working in spain
I've just been with a friend to get her NIE number, altho she didnt want a residencia (she doesnt live permenantly in Spain). So she has been issued with an NIE number and no residency and told that it is only valid for 3 months
Jo xxx |
Re: Self employed uk resident working in spain
Yes. Great advice. Except, I thought that under the double taxation treaty, I am only liable for tax in the country I select. For example: If Im in spain for more than 183 days and yet in Uk for 90, I can pay in the UK or Spain, but not both. Especially if I can show that I pass the fiscal residence test (resident in UK, habitual permanent domicile) and have the certificate from the UK authorities showing this. Is that right?
thanx |
Re: Self employed uk resident working in spain
1 Attachment(s)
here's a copy, attached, of the fiscal residence test. taken from The IR web page. According to it, I'm deemed resident in the UK and therefore I deduce that I must pay tax there, unless I want to be a dual resident.
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Re: Self employed uk resident working in spain
Originally Posted by twbag
(Post 9187459)
Yes. Great advice. Except, I thought that under the double taxation treaty, I am only liable for tax in the country I select. For example: If Im in spain for more than 183 days and yet in Uk for 90, I can pay in the UK or Spain, but not both. Especially if I can show that I pass the fiscal residence test (resident in UK, habitual permanent domicile) and have the certificate from the UK authorities showing this. Is that right?
thanx |
Re: Self employed uk resident working in spain
Originally Posted by twbag
(Post 9187142)
Havent had any probs renting privately or with anything, they just require a large deposit and bank guarantee. Happy wk/end :)
|
Re: Self employed uk resident working in spain
Originally Posted by twbag
(Post 9187459)
Yes. Great advice. Except, I thought that under the double taxation treaty, I am only liable for tax in the country I select. For example: If Im in spain for more than 183 days and yet in Uk for 90, I can pay in the UK or Spain, but not both. Especially if I can show that I pass the fiscal residence test (resident in UK, habitual permanent domicile) and have the certificate from the UK authorities showing this. Is that right?
thanx There is certainly some overlap in terms of 90 or 183 days but, as said before, I think you are currently not correct and the bank is right. |
Re: Self employed uk resident working in spain
Originally Posted by snikpoh
(Post 9187556)
From what you say, I thought you had to declare tax residency in Spain for world-wide income and then offset any tax paid in UK (double taxation etc.).
There is certainly some overlap in terms of 90 or 183 days but, as said before, I think you are currently not correct and the bank is right. |
Re: Self employed uk resident working in spain
Many thanks for your advice.
10 years ago i had a meeting with spanish authorities and uk alike. according to the spanish hacienda,UK IR and the double taxation treaty, i can be in spain for up to 183 days and pay in the uk. However if im in spain for more than 183 (resident in spain) and 90 days in uk (resident in uk), i must have the certificate of fiscal residence, according to the treaty, from the uk IR. With this i can continue decaring tax in UK and working as self employed in uk and spain. The question is, has there been some change since? has the goverment changed this and now im obliged to get the NIE even if im less than 90 or 183 days in spain? And this new spanish no residence certificate from the police? I was always told that it is expensive and difficult for spanish authorities to prove one is more or less time in spanish territory. Whats more, with the certificate of residence in UK, specially made for spain, they probably wont look further unless one moves large amounts of money out of spain or see irregular activity. What do you think? |
Re: Self employed uk resident working in spain
I don’t know if this is helpful, but the Spanish tax authorities are cracking down on ‘black’ money and in the Alicante area and they have openly stated that they are starting with expats.
I don’t know what the penalty is for not having a NIE number under your particular circumstances, but it sounds as though you have sufficient documents to baffle them for a while at least. As Rotor pointed out, once you’re in the Spanish system, you’re ****ed. (If you have a partner with a NIE, then on the very few occasions that you may need one, use theirs). |
Re: Self employed uk resident working in spain
Originally Posted by twbag
(Post 9187663)
Many thanks for your advice.
10 years ago i had a meeting with spanish authorities and uk alike. according to the spanish hacienda,UK IR and the double taxation treaty, i can be in spain for up to 183 days and pay in the uk. However if im in spain for more than 183 (resident in spain) and 90 days in uk (resident in uk), i must have the certificate of fiscal residence, according to the treaty, from the uk IR. With this i can continue decaring tax in UK and working as self employed in uk and spain. The question is, has there been some change since? has the goverment changed this and now im obliged to get the NIE even if im less than 90 or 183 days in spain? And this new spanish no residence certificate from the police? I was always told that it is expensive and difficult for spanish authorities to prove one is more or less time in spanish territory. Whats more, with the certificate of residence in UK, specially made for spain, they probably wont look further unless one moves large amounts of money out of spain or see irregular activity. What do you think? The UK will always be happy to issue you with a certificate of tax residency because they want the tax. You have to be very sure that Hacienda agree with this if you are now spending more than 183 days in Spain. As for the NIE - as I said before, if you spend more than 90 consecutive days in Spain you are now obliged to register and will get an NIE - that is a change in the previous rules (about 2 years ago). As for Hacienda finding it difficult to prove that you have been in the country for the relevant amount of time, you have that the wrong way round - if they challenge your residency status it is up to you to prove that you have not been in Spain for more than the 183 days. |
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