amideislas

The problem shows up when you make a stupid mistake.. For example, getting stopped at a Guardia civil checkpoint without your passport, or any proof that you are only "visiting" or are otherwise legally non-resident. At that point, they can impound your vehicle and demand you show up at the customs office to prove your legality and get your vehicle back. If in that process, you are unable to prove that you are not in violation, there's a broad range of legal options they have, from fines to deportation... There was a well publicised outrage from the EU a few years back about this practice, after the Guardia seized the car of a high ranking EU official visiting from Brussels because he couldn't prove his legality "on the spot".

Leper

What I am saying is not rubbish. I am not advising people to dodge tax payments. Believe me, we in Ireland know enough about tax and have been taxed nearly out of existence over the past nine years of recession.

Most of us are liable for tax and we pay it in our own countries where we live. Some of us cut down hours or retire early and want an extended sun break and Spain is ideal for this. It is not unusual to do this and there's nothing wrong with a six/seven months break.

Enter Spanish Bureaucracy and indirect taxation income (i.e. tax paid on food, drink ,cigarettes etc) is not appreciated and "they" want "us" out or pay income tax (even in our pensions that are already tax deducted in Ireland) in Spain. This defies all economic logic. Tell you what, come to Ireland spend all you like and we'll do everything to keep you, but sadly, far less sunshine.

If Ireland ever leaves the EU it probably will be as a result of the likes of stupid Spanish Red Tape. And as were are continuously informed, we are all Europeans.

bobd22

As always when this subject comes up it goes way a way from where it started. The OP gave a set of circumstances asking if what they propose was doable? Reality is yes perfectly doable within current rules without a need to become tax resident. Someone then said in one year they would be one day over the 183 days (I personally don't see that) but if they are either go back or come out one day later or earlier. The only thing missing was the 90 day rule should they not go back to UK or take a short trip out of Spain. OK these rules are there and law but I agree with Leper if say you stay 92 days is anyone in reality going to go through the rigmarole of getting health insurance proving income etc etc etc ? I would not encourage people to break any law but let's be realistic please. As for being stopped well carry your passport because that is the law as well along with driving documentation. Only thing OP needs to concern themselves with as I see it given they will be in total living in Spain 12 months split over 2 tax years is decide how to deal with the 90 day rule (ignored as we know by many but down to choice) and work out how they will deal with any medical requirements as pushing the EHIC a bit unless you can show at least a short return to UK. As Fred pointed out the big problems will come should anyone try and avoid paying tax anywhere.

Fred James

Not quite correct. All pensions and annuities arising in Ireland are ONLY taxed in Ireland, not in Spain.


Double Taxation Treaty between Ireland and Spain

Articles 18 and 19

Leper

Thank You Fred. But, if I were to be spending most of my time in Spain, I would have no problems paying income tax there rather than in Ireland. But, the Spanish Authorities would prefer me to be paying income tax in Spain and are not happy that it is only the indirect taxes that I must pay (on food etc). Not for the first time, Spain is shooting itself in the foot by putting laws where they are not needed and have lesser income as a result.

Fred James

You would not have the option to pay tax in Spain on your pensions. As I pointed out, it MUST be paid in Ireland. It's the same with UK Government pensions.

I really cannot see how Spain is shooting itself in the foot. If you don't like the tax system in Spain, perhaps you should find somewhere else where the rules suit you better - you do have a choice!

EsuriJohn

If the new Irish DTT is similar to the UK one he will pay his tax on his GP in Ireland but from 1 Jan 2016 there will be a second charge from the Spanish tax authority which Fred refuses to let call a double tax!

Fred James

No, it's HMRC that refuse to call it a tax - otherwise it would not be allowed. That said, it "could" result in some people with significant other income, paying more tax overall, but many will not.

CapnBilly

Well, it may be me again, but I don't read it that way, I read it the same as the Spain/UK DTT.

The official term for the methodology where the income total includes income that is only taxable in the country of payment is "exemption with progression". The previous UK/Spain DTT used the "full exemption" method. Its a standard OECD methodology and has been around for many years. In fact its included in the Eire/Spain DTT which is dated 10th February 1994.

Fred James

You are of course right - read in haste , repent at leisure - I missed the residency bit. but either way, you don't get taxed twice on the same income.

I'm always glad you are there looking over my shoulder!

Countryboy1

Can't quite see how one can provide proof of only visiting. What would one produce? Also the same with proving one is legally non-resident. I'm not necessarily doubting it, I just want it clarifying.
Thanks.

Fred James

If visiting, return tickets would help. As for proving non residency then it's a question of proving that you were somewhere else. Phone and utility bills, credit card transactions etc in another location would help but it would not be easy and it's down to you to prove absence.

That said, I can think of no circumstances where this would be likely to happen unless you were a very wealthy tax evader.

bobd22

I think that is exactly the point Fred. One thing that could cause a problem for a non resident is signing on the padron which many do. Not saying that would trigger a problem but it could. When I was looking into buying a vehicle many told me no way without signing padron. Research told me this was incorrect and in the end not being on it was not an issue. As you say Fred it is down to the individual to prove if residency becomes an issue but that is very unlikely in reality. Other thing I think non residents should ensure is that they pay the non resident tax, easy not to do but as well as being lawful it helps your non residency case.

Wanderindoll

I think I'll stay put in Tz!Staying legal is more complicated than I thought, I'll need a long term tenancy so I'll need an NIE number? Is my budget realistic, €1350 or there abouts per month for everything.my NHS pension is taxed in the UK and I won't be getting the old age pension for ages yet.

EMR

Have a look at Portugal and the Non Habitual residency scheme,details on the Portugal section of British expats.