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Taxes / residence / 180 day rule

Taxes / residence / 180 day rule

Old Feb 11th 2017, 4:59 pm
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Default Taxes / residence / 180 day rule

Hola todos.


We have a houses in Spain and England and travel between them 3 months on 3 months off. So that makes 6 months a year in Spain. Depending on ferries / flights we might sometimes go over the 6 months by a few days, up to a week perhaps but no more.


I have often read that if you spend more than 6 months/180 (?) days in Spain you are regarded as resident and have to pay residents' tax there. Two questions:


1. Would a few days extra make any difference?
2. How do the relevant authorities know how long you spend in Spain?


We pay all non-resident taxes on the nose, and don't want to do anything illegal. I just wondered if we should be more careful about not going over the 6 months.


Thanks
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Old Feb 11th 2017, 5:17 pm
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Default Re: Taxes / residence / 180 day rule

This link explains

https://www.gov.uk/guidance/residenc...ments-in-spain
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Old Feb 11th 2017, 8:52 pm
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Default Re: Taxes / residence / 180 day rule

Thanks for that. Very interesting.


Do the residency rules apply only to people who stay longer than 3 months at any one time? Is there no rule concerning the total period spent in Spain during the year?


Residency doesn't seem applicable to us, as we spend half our time in the UK. We organise all dental and hospital appointments for when we're in the UK. If (when) we get to the stage of needing social care our Spanish house would just become a holiday home for the kids. I appreciate that residency/entry onto the padron benefits the local community, but I don't want to risk messing around with our tax situation here or our pensions.


Unless anyone else has any observations, I think I'll just make sure we don't overstay our usual 3 months at a time (in case there are any questions from the Ayuntamiento !).
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Old Feb 11th 2017, 11:27 pm
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Default Re: Taxes / residence / 180 day rule

Originally Posted by FranE View Post
Thanks for that. Very interesting.


Do the residency rules apply only to people who stay longer than 3 months at any one time? Is there no rule concerning the total period spent in Spain during the year?


Residency doesn't seem applicable to us, as we spend half our time in the UK. We organise all dental and hospital appointments for when we're in the UK. If (when) we get to the stage of needing social care our Spanish house would just become a holiday home for the kids. I appreciate that residency/entry onto the padron benefits the local community, but I don't want to risk messing around with our tax situation here or our pensions.


Unless anyone else has any observations, I think I'll just make sure we don't overstay our usual 3 months at a time (in case there are any questions from the Ayuntamiento !).
In a nutshell Spain says if you stay over 90 days in one visit you should sign on the Foreigners register which basically means taking out residencia. This though does not mean you would be tax resident . If you are in Spain for a total of over 183 days in the tax year Jan 1 to Dec 31 then you legally become tax resident. From what you have said yes legally you may slip over by a couple of days possibly. However as you are just taking long vacations in your holiday home I would not lose any sleep. There are people who live under the radar for years let alone the odd few days over . I would continue as you do keep up to date with non residents tax and ensure you DO NOT sign on the village or town padron .
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Old Feb 12th 2017, 8:33 am
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Default Re: Taxes / residence / 180 day rule

There obviously have to be rules and applying them needs some interpretation. Whilst some people deliberately flout them to avoid tax etc others who live as 'swallows' providing they are paying tax etc in the UK are probably safe for the moment.
How things will lie after the Brexit deal is anyone's guess. But if you intention is purely extended holiday here then I would relax for now.
Obviously non-resident Spanish taxes are due for those that own Spanish property and those obligations need to be fulfilled.
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Old Feb 12th 2017, 9:03 am
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Default Re: Taxes / residence / 180 day rule

If the thousands of "Swallows" correctly signed on to the foreigners register after 90 days and correctly signed off again when they returned after their 6 month break, the entire system would collapse (not that it's that efficient at the moment).

As Bob said, DO NOT sign on the padron, even if the town hall asks you to. Unless you are a HABITUAL resident, you are not legally allowed to do so. Declaring that you are habitually resident could open to claims that you are tax resident.

Last edited by Fred James; Feb 12th 2017 at 9:06 am.
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Old Feb 12th 2017, 10:29 am
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Default Re: Taxes / residence / 180 day rule

Thankyou, Bob, Spainrico and Fred. I will now relax about the whole issue. We do pay tax in the UK, and all our non-resident taxes in Spain. We actually believe in paying our taxes, as we don't subscribe to the "something for nothing" philosophy.


Thanks again all. You've all been very helpful.
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Old Feb 12th 2017, 6:36 pm
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Default Re: Taxes / residence / 180 day rule

It's a bit long winded but the link below will answer all your questions. It also provides examples of different scenarios with regards to residency. Just scroll up and down.


www.gov.uk/government/uploads/system/uploads/attachment_data/file/547118/160803_RDR3_August2016_v2_0final_078500.pdf#page30

Last edited by lic; Feb 12th 2017 at 6:40 pm.
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Old Feb 12th 2017, 9:42 pm
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Default Re: Taxes / residence / 180 day rule

The UK residency rules are not really involved in the scenario described. There is little doubt that the poster is UK tax resident - the question is whether there is any risk of also being Spanish tax resident. The UK/Spain double taxation agreement covers the case where you are deemed to be tax resident in both countries.
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