Originally Posted by Ashcan

If you turn the page to Article 19 you will see it confirms what I said earlier about pension with tax deducted at source.

Originally Posted by Ashcan

I have spoken with our tax advisers.

If you turn the page to Article 19 you will see it confirms what I said earlier about pension with tax deducted at source.

There is no Law anywhere that compels you to pay tax in Spain on income otherwise derived, unless it is derived in Spain, so long as tax is paid on it somewhere. The statement that you should be taxed on your worldwide income if tax resident in Spain presupposes you are not paying tax on it anywhere already. If you decide it is in your best interests to remain a UK tax payer for assets and income streams there or anywhere else in the world, bar Spain, then you are quite entitled to do so.

• if you own property in Spain you have to put in a tax return and pay tax in Spain which at the moment I am sure you all are doing;
• if you do not own assets in Spain then you do not have to put in a tax return unless you live in Spain for more than 183 days and have income in Spain.

Income that is taxed elsewhere (including un-taxed pension income on which you pay tax in the UK by choice) need not be declared in Spain although you can do so.

It has been cynically suggested to me that the reason you are paying tax on your non-source taxed pensions is that someone in an office with a brass plate at the door told you that you had to fill in a form “so that you pay taxes on all your income here in Spain”, so you signed the form and they got you. Had they asked “Are you paying tax on your pension in the UK” and you answered in the affirmative, then they couldn’t have said “You cannot anymore because you are resident in Spain” because that would have been wrong.

You have found the source treaty document so you don’t need that link; if you have a properly qualified tax lawyer to hand then he will charge you a fee and confirm all this for you.

There is no need to go any further with the Property Tax thing because this is now a well known mechanism; the reason why it is not common-place is because estate agents sell houses not tax strategies and because few people think to check anything like that out because “at home we go out and buy a house, it must be the same in Spain” and of course UK based IFAs and Accountants know diddley squat about matters Spanish - well guys you know as well as I do that there is plenty about Spain that is quite different to the UK and Hurrah for that mostly, but tax-wise when you buy a home in Spain the accumulated Inheritance Tax, Capital Gains Tax and Purchase Tax actually means that you are also buying a huge tax burden of between 30% and 50% or more of the value of the property so anything that can be done, so long as it is cost effective, to remove such taxation legitimately is a very sensible investment of money especially at a time when traditional investment is both unpredictable and showing very little return.

This debate is going nowhere, I have no intention of getting up anyone’s noses over this, you take what advice you have paid for and if you are happy with it then fine, however there’s more than one way to skin a cat if you are prepared to take the blinkers off and step outside the box.

End of.

Originally Posted by scampicat

Oh and he also told us (I've seen this thing discussed on this forum before) that our four-year-old Padron Certificate was perfectly acceptable and that it only needed to be renewed if we moved house. I've seen posts on here which say they need to be renewed every three months! Maybe it's one of those things that varies from place to place.

Originally Posted by scampicat

We have finally solved our tax problem!! (Getting registered for Spanish tax and couldn't find out how to do it, even our gestor said my husband's Teachers' pension had to be declared for tax purposes.

Went yesterday to a place which caters for local expats with financial problems or queries.

Paid 40 euros to speak to their wonderful Accountant, who is bi-lingual. He took information from us and told us we didn't have to pay any tax in Spain . He then said he would come to the Hacienda with us to make sure we got registered - he also said we may actually BE registered as with some people it happened automatically when they got their residency card. (He didn't know why some and not others ).

Anyway, we got there, no queue , and he asked the lady to check and we WERE registered and have been for four years! No-one ever told us. He arranged with the Hacienda to give us a Certificate of Tax Residency which means that we don't have to keep sending in tax returns saying 'nada' , and explained that once we were both 65, assuming we were still resident, then we wouldn't have to pay any CGT if we sold our house. PHEW!

Also we haven't broken any laws by not submitting a Tax Return or obtaining a Certtificate of Tax Residency before this and do not have to bother the Hacienda again.

He is now going to sort out our Spanish wills which he found out for us have never been registered with a notary, as they should have been (the guy who drew them up said everything had been done) and at the moment they are not legal.

Well worth 40 euros! A terrific weight off my mind.

Originally Posted by susanweeruiz

Is there an office like the one described by scampicat in the Gandia area that someone can point out to me? My mother-in-law (she's French and is 68 yo) has been living here for 5 years (owns a small apartment here but nothing in France) and tells me that she's still declaring her taxes in France because she was told that she doesn't have to declare taxes here as she does not receive any income here (sounds like what Ashcan described earlier ). She definitely lives more than 182 days here, is this even legal?

She registered as a resident 5 years ago now isn't she automatically in the tax system? Shouldn't the tax return papers be sent to her every year automatically?

We are concerned that she may be slapped with the CGT if/when she sells her apartment.

Originally Posted by susanweeruiz

She registered as a resident 5 years ago now isn't she automatically in the tax system? Shouldn't the tax return papers be sent to her every year automatically?

Originally Posted by spainrico

What is a 'Certificate of Tax Residency' referred to above, why is it issued to non tax payers ? How long is it valid. How do you obtain it ?

Originally Posted by spainrico

OK now I understand its purpose. I thought I read somewhere you have to make at least 3 consecutive returns for the CGT benefits.