sophbot

Hi there everyone

I am proposing to my UK company (which I am a full-time employee of) to let me continue to work for them but be based in Spain. I think they would want me to return to London to work for say 10-12 days a month, in a row. I am seeking some clarity on which of the following situations would be the most beneficial tax-wise:

1. I register as autonomo in Spain as soon as I arrive and therefore direct payroll to pay me in pounds with no tax subtracted, and do my own seguridad social/income tax in Spain.
2. Set up a UK company and work for my current company as a consultant and charge in pounds a rate high enough to cover my SS/taxes/VAT which I will pay in Spain.
3. Relocate to Spain but continue to pay National Insurance/income tax in the UK for my first 90 days, seek advice from a gestor and then act.
4. Another option I have missed that someone can shed light on?

Appreciate your assistance in advance.

Many thanks,

Sophie

cricketman

Number 1 is what I do, through a TRADE autonomo contact. I have another 3 people in my office who do the same

I have spent a good sum of money at an employment lawyer. A gestor cannot help you here

Your other options you listed I dont think will work

The other options I was given were:
- Persuade my employer to open a Spanish branch, and employ me and the rest of the team through that (costs tons of money)
- Get the British company to pay through the Spanish social security system (complicated and they will need to hire an administrator at around 300-500 euros per month, plus pay Spanish social security contributions and comply to Spanish contractual law which they probably wont like)

Number 1 is by far the simplest solution

Rosemary

Hi and a warm welcome to the Spanish forum on BE. Myself and Fred James are the moderators for the Spanish forums whilst BEVS moderates Europe. Moderators are there to ensure that the site runs smoothly within the rules of BE. This is so that members gain the information that they are looking for and find their experiences on the forums to be friendly and worthwhile.

Problems and complaints should always be addressed to a moderator who will look into the matter and deal with it efficiently and fairly. Our members who post in the Spain Forums are usually friendly and helpful with a wealth of knowledge about the issues of living in Spain. I hope that you enjoy your time participating in the forums.

Please let me know if you need any further help.

Rosemary

Albir_Tom

If your interests are in the UK and your income is GBP surely you must pay uk tax on it ?

I am probably wrong but that is really what springs to mind first!!

Boseley

If you are resident in Spain for 183 days in a year, then you are a Spanish fiscal resident, you have to complete a tax return which includes all world wide income. (with some exceptions, Govt Pensions,) Spanish tax will have to be paid on income, because you are domiciled in Spain you will not pay U.K. tax on your income.

Albir_Tom

Can I ask though, if you are in Spain for more than 183 days a year and you do not own any property here, earn any money here, claim anything here, all interests are in uk, taxes, n.i contributions etc and you do not declare it to Spanish government who are you actually committing a crime against if anybody at all ?

Iv gone through this before and it got very heated which I don't want to happen again.

I run my uk business from my laptop and phone here in Spain and this 183 day rule has never affected me because the way I look at it I am on an extended holiday I don't own property here I don't even have a Spanish bank account I have no ties to Spain I am just in the country on holiday to be nearer my family.

And if anything I'm spending my hard earnt british coin here in Spain like the good tourist Spain wants no ?

I just don't get what difference it makes honestly it certainly doesn't make me a criminal anyway.

Boseley

That is the way it is, the law, if you are here for over 183 days, you are required to submit a tax return, plus the tax office will do it for you. Apparently failure to do so can be punishable by a fine.

The individual decides for him/herself what to do. I take the easy way, submit the damned return, keeps me on the straight and narrow, and is to my advantage, now and again I receive a rebate, and there are other entitlements.

Albir_Tom

So to be able to submit a tax return here do you need to register as autonomo first ?

I may aswell look into this.

Fred James

No, if you are tax resident (183 day rule), you must submit a tax return showing your world wide income.

If your world wide income is very low, you may be exempted from this requirement, but for your first year of tax residency you should submit a tax return, even if there is no tax to pay.

If you do have property or assets in Spain then being tax resident gives significant advantages with regard to CGT and IHT that non residents are not entitled to.

billgates

This isn't necessarily the case.
It depends on where you actually carry out your work.
If you are in the uk for more than 90 days in any year then I believe that the uk tax authorities want to know about it.
I am a UK employee but carry out my work in Spain and have gone down the autonomo route. I probably spend only about 70 days in the uk so I don't pay UK tax or NI.
If you are in Spain for more than 183 days then you must submit a Spanish tax return. No different from the uk really in that you deduct allowable expenses and allowances for family.

Mitzyboy

The trick of course is to ensure that you can prove that you have been in Spain for less than 183 days and then you are not tax resident, or do you have to worry about the modelo 720 assets declaration, employing gestors etc

cricketman

And just as importantly, if you are resident in Spain and working then you must pay social security in Spain

Albir_Tom

So the question is which system
Benefits most, uk or spain ? Looking after #1 and all that 😏

cricketman

If you are resident and working in Spain, you must go through the Spanish social security and tax system

If you choose not to then you will be breaking the law and risking big fines and possible imprisonment

I understand that doesnt stop a lot of British people ignoring the Spanish system but I do not recommend that

sophbot

Hi guys

Thanks for your advice. So just to be clear, say I move to Spain in January. Should my pay for that month onwards still include NI and UK income tax deductions, or should I be paid gross and pay seguridad social and autonomo fee monthly/quarterly, then when I submit a Spanish tax return I will then be charged income tax?