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Tax in Spain

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Different types of taxes apply in Spain, including income tax. Find all relating information in this article.

All foreigners having lived in Spain for more than 183 days in Spain during a fiscal year are considered as residents. Hence, they have to pay income tax. Workers earning wages in Spain are also deemed to be fiscal residents, even if they have not formally registered with the Registro Central de Extranjeros. So if you have decided to settle and work in Spain, you are advised to inquire if there is any non-double taxation agreement between Spain and your home country. The Spanish Tax Department, that is the Agencia Tributaria might help.

Given that Spain consists of 17 autonomous communities, tax rates may differ from one region to another.

 Good to know:

Tax year starts at as the 1st January and ends on the 31st December.

Income tax

Income tax in Spain generally varies between 19% à 45%. In fact, it is deducted at a progressive rate according to your salary. You are required to fill a tax declaration before the 30th of June whereby the “Campana de Rentas” begins. Spain residents may be eligible to some benefits or deductions according to their personal situation, that is, if they have children and if they have to pay transport fees, etc.

Note that tax in Spain is calculated as from the first payment. However, there is no exemption threshold for income tax although rebates and certain deductions apply. 

Independent workers

Independent workers have to pay their income tax and make their social contribution themselves. It is therefore recommended that they hire an accountant or a tax adviser to assist them with related procedures. Tax rates for independent workers vary between 18% and 43 %.

Other taxes

Non-residents in Spain also have to pay movable and immovable property tax (IVA rate ranging from 1% to 6%) on purchasing a property in the country. Other taxes such as wealth tax, capital gains tax and inheritance tax also exist in Spain.

Note that your resident or non-resident identification number will be required during all tax related formalities.

Tax return

You are required to fill in your tax retun at the latest on June 30 of the following year. In case your income does not exceed 22,000 euros, you are exempted from the tax return obligation. Note that income tax is deducted at source by employers, followed by some adjustment. 

 

 Useful links:

Agencia Tributaria www.agenciatributaria.es
Agencia Tributaria – Income tax for non-residents www.agenciatributaria.es/AEAT.internet

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