scampicat

So, the vast majority my husband's income is from his Teachers' Pension. He would not have to declare this in Spain, would he? And his personal allowance would more than cover the other 2k per year that he has (This is Incapacity Benefit, would he have to declare this, or is it also classed as a Government Pension?).

My income is solely from my State Pension and is about 6000 euros a year. Am I right in thinking that this too would be under my personal allowance?

Just to make things absolutely clear, as I have been told several different things (as usual). One gestor insisted that my husband would have to declare both his Teachers' Pension and his IB, an accountant said he would not have to declare his Pension nor his IB.

Fred James

Yes, your state pension will be well under your allowances so no tax due.

Your husband's teachers pension is not declared in Spain. I am not sure about the IB - it may well be taxable in Spain but his allowances would more than cover it anyway.

You will be able to do a joint declaration and still pay no tax but you are still obliged to make a declaration even if it does not result in any tax being due.

scampicat

Thanks!

EsuriJohn

If only Fred was on the other side of the counter at the Hacienda he seems to know more about their systems than they do. I know that Kaths Teachers pension and my Civil Service pension are not declared and that our state pensions exported direct to Spain would be under the Spanish allowances. However in order to sort it all we need the HMRC form FD9 completed and returned and we need to be registered and declare for tax in Spain. We have tried in vain to get this done but they just do not seem to want to make this possible.

I am sure that if we were in say Marbella or some other Brit enclave on the Med they would understand but here they regard us as strange trying to declare.

Mitzyboy

I dont understand.
Here in Valencia we downloaded FD9 iirc and took it to the tax office in Valencia City. There, they endorsed the forums and then these were forwarded to HMRC Nottingham after being received back here.

Mine were returned by HMRC Nottingham because they didnt see why I wanted to zero myself in the UK, but the wifes were processed. Tbhere is a delay, at the time it was said to be 6 months. She is now not taxed on her state pension in the UK, but pays very little on her Civil Service pension

EsuriJohn

Thats the position we want to be in. With a very few exceptions (Cyprus, Australia) your Government Pension is always taxable at source in UK but you can export the State Pension tax free if you can get the FD9 endorsed at the Hacienda and returned to Nottingham.

Mitzyboy

Yes ..... I know ..... I've been telling people this for years
I meant, I dont understand why you are having a problem, as it's a relatively simple procedure

Fred James

I used the FD9 procedure when I first came to Spain but I understand, based on info from Blevins Franks two years ago, that Hacienda no longer accept form FD9. Their recommendation is to get a certificate of fiscal residency from Hacienda which HMRC will accept in lieu of Form FD9. This will normally only be issued after a tax declaration has been made and tax paid in Spain.

This is no problem (apart from the delay) for most people who will be submitting a tax declaration and paying tax.

In Scampicat's case this certificate has proved difficult to get, possibly because no tax has been paid in Spain (because there isn't any due!). If tax had actually been paid at least it could be claimed back from HMRC against the tax paid in the UK.

I have also read reports on other forums where the FD9 is now being accepted again (within the last year).

It seems to me to be yet another case of each tax office making up its own rules or at best interpreting the rules incorrectly.

My advice would be to find a gestor who really does understand the rules and get him to sort it - that said, finding such a person is not going to be easy.

Mitzyboy

That may be a reason then, because when we lodged our FD9 papers in Valencia (12 months ago or so) we lodged copies of our tax returns with them. Even though they were zero tax returns.

As I have said before, its worth putting a zero tax return in here in Spain.

EsuriJohn

Neither do I! however some Spanish friends of ours Madrilinoes who have lived in Ayamonte for many years say that it is very "Provincial" and that they have to travel to Faro, Huelva or Sevilla for culture. Our night school Professora in the Spanish class corrects the collins English/Spanish dictionary since it is not Andalucian Spanish and down here we spell things the Ayamonte way. No one in the Hacienda will even try to stuggle with Spanglish (not that they should but it would help all round). The problem arises on the other side its been comfortable down here with a job for life and a pension and we Brits seem to disturb the equlibrium!

scampicat

Same here. They don't know what to do. They don't know what we want! And last time we took a native Spanish speaker with us, that is how we found out we were actually already registered as Tax Resident.

People don't always realise how these rural places are not up with the times and still living in the 1920s!

I too wish I could take Fred with me.

We will be trying again soon (taking a person who speaks Dutch, Spanish AND English and has lived in Spain for over twenty years. Although even she does not understand what we want to do).

Fred James

Well, to be fair to Hacienda, I am not surprised.

If you look at it logically, you want them to sort out your paperwork and issue a tax certificate when you have no intention of paying any money into the Spanish economy in the way of income tax.

You are doing it solely so you can avoid paying money to the UK government and gain tax advantages in Spain when it come to paying CGT and IHT. It is this key point that they seem to fail to understand - it means a lot to you but nothing to them!

If you look at it from that point of view and taking into account their typical "jobsworth" attitude, it goes some way to explain their reluctance to be very helpful!

That said, you have every right to do so and they should understand the situation and be able to sort it out quickly and efficiently.

As I said before, from my experience and from that of others, it gets a lot easier if you are above the tax threshold and are going to end up paying them some tax.

scampicat

But Fred we don't have enough income to pay tax in Spain,(their rules, not mine), so why should we have to pay some just to get a tax certificate?

I hope once we have given them a tax return they will issue us with the certificate.

Yes, it will be to our advantage CGT- wise but we are doing nothing wrong. All the rules say (AFAIK) is that you have to be tax resident to gain from these rules, not that you actually have to pay any tax.

We are law-abiding people and are trying to do the right thing.

But I agree that the Jobsworth attitude will probably deem us not worth spending any time on as we are not going to give them any money.

If we have no success we will pay our accountant to do it for us. TBH, I would have done this in the first place, but my husband didn't particularly want to spend the money and everyone on here said it was easy and the Hacienda would help you!

Most retired expats on State Pensions that I know don't bother putting in tax returns and can't understand why we are doing so. Given the palaver, can you really blame them?

Mitzyboy

Because it proves you have been here and available to pay tax! It costs €60 for two people here per year for a simple tax return, and it can be beneficial.

Fred James

No you are not doing anything wrong - you are well entitled to a certificate and to get a rebate on your UK pension.

The problem is that your income in Spain is not enough to trigger them into any action as there is nothing in it for them!

Yes, the first thing to do is get them to accept your tax declaration in May/June and take it from there. You can go to the tax office and get them to fill in the details on their computer which will produce a zero return. You will need to take someone who speaks Spanish as they may well tell you that you don't need to make a declaration (untrue but it won't stop them trying to avoid any extra work!)

You can do the declaration on your own PC and get your bank to send it to them - that way they cannot refuse it. You can of course get a local gestor to do it all for you but it could cost you up to €100.