Were you stuck in Spain during the lockdown?
Were you stuck in Spain during the lockdown? Then avoid paying taxes in Spain as well.
On 14/03/2020 there was a unanimous decision of the 50 provinces that Spain went into lockdown. If, because of these restrictions, you have resided in Spain for more than 183 days, even if it is not your country of residence, Spain will count you as a tax resident. The Spanish tax authorities therefore do not take into account that the lockdown affects your stay and refer to article 9 of the Personal Income Tax Law (Ley de IRPF).
In Spain, tax residence is determined according to criteria such as tax periods and calendar year, in general:
- Any person who resides in Spanish territory for more than 183 days during the calendar year, regardless of consecutive or interrupted.
- Spain is the main source of economic activity or interest, directly or indirectly.
- When the person in question does not live in Spain himself, but the ex-partner from whom he is not legally separated and possibly the minor children do live in Spain.
If you find yourself in one (or more) of these situations then Spain may hold you liable for income tax and you will be taxed in Spain on your worldwide income. Spain will then consider you both tax resident (subject to Spanish tax liability) and legal resident (subject to Spanish law). In the event that you are notified of this tax liability, make sure that you can prove that you are subject to tax in another country.
Doubts have been raised about the interpretation of the application of this law and, again, Spain appears to be going its own way. The OECD (Organization for Economic Co-operation and Development) had made recommendations to its members on this subject, which countries such as the United States, the United Kingdom, Ireland and Australia, have adopted. Several countries will respect the recommendation however in Spain there is no distinction made as to whether the period of stay was voluntary or involuntary.
Our goal at Segurantis is "to be on top" regarding these tax obligations and to keep our clients informed of what is going on in the Spanish tax landscape.
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We are here to help you
At Segurantis we work closely with local authorities and the Belgian/Dutch state. This way we try to assist you in case of questions and help you where we can. If you would like us to take care of your tax file in Spain please do not hesitate to contact us.
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