Hi Any Guidence
apparently I am to be taxed for letting out my property, even though I only let it out to one non family emmber alst year.
Does anybody know the basis of this tax, the formula they sue to asses it and if there are any techniques to avoid it?
Do they tax the spanish proerty owners too or just ex pats,
My apartment is in Mojacar, Almeria and I am a non resident
Any help is much apprecaited
I am out there next week and intend to see my solicitor for gudence too
Cheers (thought Gordon brown lived in the UK)
Diane
Hi Diane
Every one who owns property in Spain is liable for tax on them
Firstly a Wealth Tax. This is based on the value of the property. For a typical 1 bed 50 sq m apartment worth say 90 -100K about 400 - 500 Euros pa
Secondly Income Tax If the property is unlet you still pay a small amount of income tax again based on the property value providing you only own 1 property. Again for same apartment about 100 Euros pa
If you rent out the property you are liable for 25% tax on the GROSS income.
Pete
Every one who owns property in Spain is liable for tax on them
Firstly a Wealth Tax. This is based on the value of the property. For a typical 1 bed 50 sq m apartment worth say 90 -100K about 400 - 500 Euros pa
Secondly Income Tax If the property is unlet you still pay a small amount of income tax again based on the property value providing you only own 1 property. Again for same apartment about 100 Euros pa
If you rent out the property you are liable for 25% tax on the GROSS income.
Pete
Hi all, does that mean that if you pay the 25% in Spain that you don't need to pay anything in the uk.
Stephen.
Stephen.
The wealth tax (patrimonio) is calculated at 0,2%, up to €167.129,45 and on a sliding scale thereafter, of the highest of the three following values
Valor Catastral (rateable value)
Any revised value imposed by the tax authorities
Escritura value
The income tax (renta) is calculated at 25% of 2% of the valor catstral (1,1% if it has been revised since 1st January 1994.
The simplified 214 form can only be used if just one property is owned and a separate declaration has to be made in respect of each person named in the title deed with the base upon which the taxes are calculated divided by the number of owners. The taxes can be paid at any time during the year following that in which they become due.
If more than one property with a different referencia catastral is owned (even if it is just a lock-up or a garage) the declarations have to be done on form 714 for the patrimonio and for 210 for the renta and the declaration has to be made from the 1st May to 20th June in the year following that for which the taxes are due. It is still individual declarations for each owner. All of the properties may be listed on one form 714 for the patrimonio but a separate form has to be submitted for each property in respect of the renta.
If you rent out your property you should pay separate taxes on these rentals pro rata accoring to the number of days that it is rented.
Many non-resident property owners have ignored these taxes up until now but the tax authorities are now cross-checking property ownership with tax declarations so they are ignored at one's peril. Remember, they can claim back taxes for the past four years once you get caught.
Non-payment of these taxes will also prejudice any refund that is due from the 5% retention made on account of the seller's capital gains tax liability when the property is sold.
Valor Catastral (rateable value)
Any revised value imposed by the tax authorities
Escritura value
The income tax (renta) is calculated at 25% of 2% of the valor catstral (1,1% if it has been revised since 1st January 1994.
The simplified 214 form can only be used if just one property is owned and a separate declaration has to be made in respect of each person named in the title deed with the base upon which the taxes are calculated divided by the number of owners. The taxes can be paid at any time during the year following that in which they become due.
If more than one property with a different referencia catastral is owned (even if it is just a lock-up or a garage) the declarations have to be done on form 714 for the patrimonio and for 210 for the renta and the declaration has to be made from the 1st May to 20th June in the year following that for which the taxes are due. It is still individual declarations for each owner. All of the properties may be listed on one form 714 for the patrimonio but a separate form has to be submitted for each property in respect of the renta.
If you rent out your property you should pay separate taxes on these rentals pro rata accoring to the number of days that it is rented.
Many non-resident property owners have ignored these taxes up until now but the tax authorities are now cross-checking property ownership with tax declarations so they are ignored at one's peril. Remember, they can claim back taxes for the past four years once you get caught.
Non-payment of these taxes will also prejudice any refund that is due from the 5% retention made on account of the seller's capital gains tax liability when the property is sold.
Hi all, does that mean that if you pay the 25% in Spain that you don't need to pay anything in the uk.
Stephen.
Yes
Hi all, does that mean that if you pay the 25% in Spain that you don't need to pay anything in the uk.
Stephen.
I'm not sure how it works the other way around but a resident of Spain has to pay tax on his worldwide income then claim a refund under the dual taxation agreement for any taxes paid on income received in a foreign country.
It's the same system in this country. If a person's main home is here then any world-wide income has to be declared in this country. If tax has already been paid abroad then you will receive a tax credit here. However it may be the case that there is further tax to pay under Inland Revenue ruling. If you look at the Inland Revenue website there's a great deal of info on this matter. Dont assume that you will get away scot-free !! This is the only country where these swingeing rules apply 
Ann-marie b
Ann-marie b
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