Porth

Hi and before you ask we have already answered in the negative.

We have signed a contract for 11 months with allegedly a recognised and reputable agency. Again their fees have been paid and the two months deposit is already in the hands of the owner.

Today the owner has asked the agency if we could pay the rent in cash and something to do with exposure to IVA which is presume is VAT?

We are not going down this road under any circumstances and would welcome your thoughts. Maybe it is common practice in Spain. Here if one is found out then you are treated as badly as the person receiving the cash.

Now we are beginning to wonder what we are letting ourselves into. The contract is silent on payment in cash.

Also I have a relationship with the law not that matters but I just cannot do what they ask.

guidance please?

mikelincs

We've done both, we had rentals we paid in cash to the agency, and others we paid by bank transfer to the owner, all rentals had legal contracts. Remember that cheques are rarely used in Spain, most things are either paid in cash, bank transfer or direct debit. All you need to do is to ensure that if you have paid in cash you get a signed receipt from the agency, then you are covered. The owner is trying to avoid paying tax on some of the rental, if you have a DD already set up you can just continue to use that.

Porth

surely by paying cash you are really contributing to evasion of tax?

lynnxa

I pay cash each month - but I do get a proper receipt & my gestor 'does something to do with tax' with them

I HOPE my landlord is declaring - if not he got a nasty shock last year!!

snikpoh

As a landlord, I make sure that all my contracts state that payments must be made by a certain date each month and must be done via bank transfer.

In that way both I and the tenants are totally transparent - we both have a 'money trail' if anyone wants to investigate.

Tenants have asked to pay in cash but (1) it's too much hassle for me to try and find them each month and (2) it allows them to keep working 'on the black' and to hide the money (which I simply won't assist with).

Porth

This might lack logic but phone bills tax bills utility bills are paid by prelevement so why not rentals?

mikelincs

Perhaps a tax dodge by the agents?.. not that anyone in Spain would try to dodge paying taxes..

Domino

if you are getting the rental allowance in your tax return then you can rest assured he is declaring

the BH had her tax return held over because the new landlord hadn't registered it with the Hacienda. But they sorted him out and she has her allowance.