Hello
Spanish tax authority has sent me a letter indicating that I failed to pay all of mine income tax on property sale that dates 2 years ago. They asks for a payment plus interest. The sum is under 20k. I no longer reside in Spain or have any proprety, assests there.
Does anyone knows how tax authority in Spain operates in such cases?
My financial situation is far from ideal so I wont be able to make that payment. What will be tax office steps if they can only redeem part of the debt from my assest in England? How long my debt will be a burden if I dont declare bancrupcy?

It is possible to pay debts less than €30,000 in monthly instalments over a year at an interest rate of 3.75%. You may need to tell them what assets you've got in the UK or have someone willing to act as a guarantor.

Hacienda: cómo aplazar o fraccionar una deuda y qué interés tiene

If you're within the usual payment deadline period you can apply online following the instructions in the article and they will tell you if you've been successful or not. However if the deadline has passed they may not be willing to allow you to use that route, you may need to talk to either someone from the AEAT to explain the situation or a Spanish tax advisor.

Thanks for your reply. One of lawyers I spoke to said that "monthly installments" route is out of the question in my case. May be you have an idea what possibly may happen if I just pay a part that I can afford at the moment and just ignore the rest? Will they be just chasing me for ages waiting for me to become solvent again ? If thats the case, is there time limit on that?

Andy, You say Income tax on a property you sold. Do really mean Capital gains tax on the sale? If so I understood your abogado had to withold a percentage of the sale to pay the tax authority and then it is up to you to claim back the difference although I believe no one bothers usually knowing others who have sold. Have you actually checked the calculations that the authority says you owe ? Seems a bit odd to me.

Well I was fiscal resident at that time and did file income tax, however tax office claims that the amount was underdeclared. I am afraid I simply wont have financial ability to take this matter to court, so I am wondering what worst can happen if I just ignore the whole thing. I understand it can lead to bank account and asset freezes eventually, but even then it wont be enough to cover the whole debt, so what other steps hacienda may take?

There is a limitation of five years, but that is if they don't know that you should owe taxes (i.e. they can't suddenly say out of the blue you owe them money for something from six years ago). However once you're on their radar and they know you owe something then that's different.

• Here's a list of surcharges if you pay late: Types of surcharges
• And this is what happens if it still remains unpaid: What happens if I don't pay the debt
• This is the whole debt section on their website: Debts, seizures, embargoes and auctions

I'm not sure what happens if they try to collect debt while you're outside of Spain, but these two pages might help:

• Fines for late or Non Presentation of Spanish Taxes
• ¿Está Hacienda obligada a realizar notificaciones tributarias en el extranjero? (Google translate version)

It looks like if you haven't been served an official notification about the tax at your UK address because you were non-resident then you could ask for the debt to be annulled.

Thank you very much for those links. Do you happen to know if there is any time limitation on tax debts once judgement is issued? I know that for ordinary debts its 5 years after which debt cannot be claimed. Do you think something similar applies to tax debts?

I believe (and I could be wrong) that the only time limit is the one in which they have to inform that you owe money i.e. the five years. Once the tax office etc has contacted you about the debt (and they can take up to the limit before they contact you) it stays open until paid or written off.
Declaring bankruptcy doesn't get you off the debt either, it just means that they will take everything in your name and sell it off.
Not sure however if they can come after you if you are no longer a Spanish resident and have no assets in Spain (maybe thats a Brexit bonus now)

This makes some explanation
https://n26.com/en-es/blog/tax-debt

And here.
https://taxsummaries.pwc.com/spain/i...administration

Now this one is interesting, it appears that once they contact you, it resets the four year clock.

Statute of limitations

The statute of limitations for taxes is four years in Spain commencing from the day following the termination of the voluntary tax filing period.
This four-year period may re-start for a taxpayer if the tax authorities carry out any actions or proceedings, with the formal acknowledgement of the taxpayer, to acknowledge, adjust, review, inspect, guarantee or collect all, or any part of a tax obligation, or due to actions by the taxpayer such as the filing of a new or late tax return that alters or rectifies a previous tax return or the filing of an appeal or claim regarding the tax.

If it were me I would be contacting who ever did your returns when you were in Spain and ask them to clarify this urgently...
I doubt that this is going away anytime soon. And I would also expect you to get stopped if you try to re enter Spain until its cleared..
Just my 2c the last bit...

I don't know if they will give up chasing a debt they know about after a specific number of years or if they give up only when they've exhausted all possible ways they think they can get their money back.

I found this though, which doesn't look like it works in your favour... apart from the 2025 deadline:

Recovery of EU Taxes by HMRC (MARD)

My tax is pretty simple (at least it was until an inheritance a couple of years ago, fingers crossed that doesn't kick off an inspection) so this is not something I know very much about... good luck though.

I very much doubt they give up persuing tax debts nowadays. Simply because it is so easy to locate people and to keep adding up the interest and fines. The only way not to pay is to have absolutely zero assets and be taken through official routes to prove this. Declaring bankruptcy to avoid debts is now much harder too. Of course, alot will depend on the size of the debt and if they believe the OP was aware of it at the time and avoided it.

I think you need to seek legal advice from someone who knows and understands how the system works. It’s all very well Googling and finding obscure often contradictory advice on the Internet but the legal system doesn’t work like this. Again interpretation can be exactly that but someone who is trained in and works in the relevant laws would know best