Resident or Non-Resident, confusion

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15 Oct 2011 00:00 by johnzx Star rating in Spain. 3374 posts Send private message

 

 
 
Prior to the abolition of the Residencia for EU citizens it was easy to know how being resident affected us, but what happens now ?
 
A property owner stays in Spain for 3 months thus must register on the EU citizens registration. However, if they do not spend 183 days or more in any year. Thus I believe they are not tax resident.
 
Do they have to pay the non-resident property tax ?
 
Do they open a residents or non residents banks account ?
 
Can they drive a non Spanish registered vehicle for up to 6 months a year ?
 
If they are over 65 do they still qualify for the capital gains tax exception on their home ?
 
Should they register on the empadron ?
 
Can they change their national DL to a Spanish one ?
 
 
There are probably other 'anomalies' too, which have arisen since the clear cut Residencia status was blurred.  
Does anyone  KNOW the answers (Not guesses please) to these and similar questions ?
 
Does anyone know where the regulations / laws clarifying the situation can be found ?

 

 PS I don't need to know for myself but I do get asked these types opf questions.



This message was last edited by johnzx on 15/10/2011.

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15 Oct 2011 20:32 by mikesmith4 Star rating. 29 posts Send private message

 Great set of questions.  We would also to know the answers to these question, as we are hoping to move to Spain in the new year. 

Mike





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16 Oct 2011 20:34 by Roberto Star rating in Torremolinos. 3574 posts Send private message

Roberto´s avatar

John,

We've been over this before! I know you're a pedant for the 3 month "rule", but these oft asked questions demonstrate perfectly why it's a stupid and unnecessary bit of legislation, not to mention unenforceable. As for the "abolition of the residencia", I still don't entirely agree with you on this. The residencia card was abolished, but the state of residency still exists. My registration certificate may have slightly different wording to others on the basis that I am a permanent resident (due to the time I've been here), but it still clearly states that I am registered as being resident in Spain.

My view on this is that you can only be truly "resident" or "domiciled", or whatever you like to call it, in one place. So it's up to each individual to decide where their "main" or "real" home is. If you maintain a home in the UK, but also have a place in Spain which you spend maybe up to 4 or 5 months of the year in (lucky you), you're almost certainly still officially resident in the UK. You probably haven't signed off with your GP, notifed HMRC, your bank, your pension etc. etc. So despite the 3 month rule, it's just not worth the bother or the possible complications of registering. If you fully intend to return to the UK, even if you are staying 4 months this time round, you are clearly still a UK resident for all practical purposes. You are therefore by definition NOT a Spanish resident, so there's simply no point registering as one and complicating things. 

If on the other hand you spend more time in Spain than the UK, you should of course become a fully fledged resident in Spain. I am of course simplifying this somewhat, since tax or fiscal residency can actually be a seperate issue, depending on circumstances, and no doubt someone will come up with the scenario of a nomadic lifestyle resulting in less than 183 days in any one country - but you still have to be officially resident somewhere. Decide whether it's UK or Spain and stick to it.

Disclaimer: the views stated here are purely those of a stupid ape, and should not be construed as having any legal validity


 



This message was last edited by Roberto on 16/10/2011.



This message was last edited by Roberto on 16/10/2011.

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16 Oct 2011 21:45 by neatrees Star rating in Uxbridge & Vera Play.... 58 posts Send private message

When my wife and I registered with our local council in Spain for our basura etc, it appears to have given us the status of residents because earlier this year when were over at our place. There waiting for us in the post was voter registration forms. The forms were wanting to know if we intend voting in the Spanish elections.

We only spend about 20 days a year in Spain and not even in one go. We do however pay taxes in Spain (which we are about to fly over and do). The main point for registering ourselves was so that we would add to the list of residents in our area so that the local council would be obligated to provide certain amenities.

Roberto is right in that if your main place of residence is Spain then get your chorizos in a row and become Spanish.

I have official residency in 3 different countries, it is all about the money and if you have as so much as have a small toe in a country, the country wants its pound of flesh.



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16 Oct 2011 22:52 by Roberto Star rating in Torremolinos. 3574 posts Send private message

Roberto´s avatar

Just to clarify, I never suggesed anyone becomes Spanish - only a resident of Spain.

I see nothing wrong in home owners registering on the local padrón if their townhall allows them to do so without actually first being registered as a resident - but I strongly suspect that this constitutes fraudulent activity on the part of the townhall!

neatrees - I'm curious about your "official" residency status in three different countries. Presumably none of them knows about the others? And yes, they all want their pound (or kilo/euro as the case may be) of flesh, but there is such a thing as the double taxation treaty between certain countries, including the EU members. If you're paying income tax in more than one, you're probably getting screwed.



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16 Oct 2011 23:00 by xetog Star rating in Wiltshire/holiday ap.... 512 posts Send private message

We are retired and one of those lucky (??) couples who can come to Spain for longer periods (about 120 days this year), however that does not make us resident in Spain.  We are residents of the UK and pay our taxes(lucky us!) there as well as using the NHS, paying property taxes etc.  Earlier this year we decided to sign on to the Padron, which enables the local town hall to get a bit more money from the Government.  When we signed on we were asked if we wanted to vote, to which we replied no, but thank you.  Clearly we are not residents. We of course pay all of the property taxes demanded of us, but it is difficult to see how anyone can be "resident" in more than one country.  If we spent more than 50% of our time in Spain, I would seriously consider registering, but since this is not going to happen, don't worry myself about it.

M.





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16 Oct 2011 23:51 by Roberto Star rating in Torremolinos. 3574 posts Send private message

Roberto´s avatar

Apologies to OP for semi-hijacking the thread - it's supposed to be about residency, not padrón - but it's still relevant since many people confuse the two things anyway. And the padrón is confusing enough. There's plenty of info about it in English, including on this very site: http://www.eyeonspain.com/spain-magazine/empadronamiento-empadronado.aspx. The general consensus does seem to be that everyone who owns a property in Spain should register; some opinions suggest that you are obliged to if you own a property. A quick Google in Spanish found plenty too:

El padrón municipal es el registro administrativo donde figuran todos los vecinos que viven o residen habitualmente en ese municipio. Sus datos son una prueba de la residencia en el municipio.

Es el documento que acredita la residencia y el domicilio habitual.

Es un documento de carácter informativo que  indica la residencia y el domicilio habitual.

These definitions seem to suggest that joining the padrón is pretty much a case of declaring yourself permanently resident in the municipality. I found on http://www.empadronamiento.net/ this: .....lo cierto es que la nueva ley es clara en autorizar multas hasta de 10.000 euros a las personas que empadronen a un extranjero “que no resida en su domicilio”.

...which is saying that you can get a fine of up to 10,000 euros for registering on the padón if you don't reside in the municipality...but I also saw this more recent post on the same site: ....por lo que no resulta procedente denegar la inscripción so pretexto de que el ciudadano extranjero no reside legalmente en España

....which pretty much says foreigners can sign on the padrón even if they are not legally resident in Spain. Seems to me a bit contradictory, but what the heck, this is Spain! So by all means sign on even if you are not resident. You may get discounted rates and water bills (among other things) and I don't see any downside, other than the (minor) hassle of obtaining yet another bit of paper for your Spanish file. I seriously doubt anyone would find themselves facing a fine.

I have now bored myself silly on this topic and am going to go play Angry Birds instead.



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"First get your facts; then you can distort them at your leisure"

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17 Oct 2011 08:40 by johnzx Star rating in Spain. 3374 posts Send private message

Apologies, but I have brought forward my questions, in the hope that someone who really KNOWS the legal answers will not miss them.

 

 

Repeated post:-

Prior to the abolition (or if prefers the euthemism, replacement) of the Residencia for EU citizens it was easy to know how being resident affected us, but what happens now ?

 
A property owner stays in Spain for 3 months thus must register on the EU citizens registration. However, if they do not spend 183 days or more in any year. Thus I believe they are not tax resident.
 
Do they have to pay the non-resident property tax ?
 
Do they open a residents or non residents banks account ?
 
Can they drive a non Spanish registered vehicle for up to 6 months a year ?
 
If they are over 65 do they still qualify for the capital gains tax exception on their home ?
 
Should they register on the empadron ?
 
Can they change their national DL to a Spanish one ?
 
 
There are probably other 'anomalies' too, which have arisen since the clear cut Residencia status was blurred.  
Does anyone  KNOW the answers (Not guesses please) to these and similar questions ?
 
Does anyone know where the regulations / laws clarifying the situation can be found ?
 
 
 
 PS         I don't need to know for myself but I do get asked these types of questions.
 
PPS         When I said 'propery owner' above it was for the purpose of posing the questions, but of course the requirement to register applies to every EU citizen who stays three months or more,  despite some people (posters) do not like the imposition and who would encourage us to ignore the law.



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17 Oct 2011 09:24 by xetog Star rating in Wiltshire/holiday ap.... 512 posts Send private message

The answer surely is belive what you want, because like everything else in Spain you will get as many answers as people you ask!  As Bobaol points out, even the law is unclear, so everyone just makes it up as they go along.

M.





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17 Oct 2011 11:31 by Faro Star rating in London. 1156 posts Send private message

Usually tax residence is resolved by reference to the applicable tax treaty along the following lines:-

a) he shall be deemed to be a resident only of the State in which he has a permanent
home available to him; if he has a permanent home available to him in both
States, he shall be deemed to be a resident only of the State with which his
personal and economic relations are closer (centre of vital interests);
b) if the State in which he has his centre of vital interests cannot be determined, or if
he has not a permanent home available to him in either State, he shall be deemed
to be a resident only of the State in which he has an habitual abode;
c) if he has an habitual abode in both States or in neither of them, he shall be
deemed to be a resident only of the State of which he is a national;
d) if he is a national of both States or of neither of them, the competent authorities of
the Contracting States shall settle the question by mutual agreement.

Unless someone is trying to claim he/she is a tax nomad then provding tax is paid in one jurisdiction there is no problem.

I know many people (especially Nothern Europeans) who spend 6 months or thereabouts a year in Spain and there is no question of them needing to become tax resident if their main residence is outside Spain and also all their economic activities. 





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17 Oct 2011 12:11 by Angar Star rating. 194 posts Send private message

Dear Johnzx,

Regarding your questions:

Do they have to pay the non-resident property tax ? yes
 
Do they open a residents or non residents banks account ? non resident
 
Can they drive a non Spanish registered vehicle for up to 6 months a year ? if bring from uk for holiday and return with it, else if vehicle here permanently should be registered in spain
 
If they are over 65 do they still qualify for the capital gains tax exception on their home ? i dont think non residents get this
 
Should they register on the empadron ? only if living in the spanish property
 
Can they change their national DL to a Spanish one ?only if resident
 
The questtion of resident or non resident really is a tax one. The fact that they dont issue a card at this time is irrespective, one can receive a certificate of residency (nb. no value as id.) So really the situation is the same, if you spend more than 180 day in the country one can be considered for tax purposes as being resident.
 
 
 




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17 Oct 2011 13:05 by johnzx Star rating in Spain. 3374 posts Send private message

 
Any chance of a professionally informed reply instead of educated and even uneducated guess. 
 
Thanks Guys.
 
PS  for Tax Residence, if one in  Spain for 183 days or more in 12 months  (not 180) they are tax resident.  However, there are other criteria too, like having one's main residence in Spain, regardless of the time spent here,  but that was not one of the questions.



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17 Oct 2011 13:56 by Faro Star rating in London. 1156 posts Send private message

John

The answer lies within the DTA and protection can always be sought under an applicable tax treaty and the tie breaker rules.

You would need to look very carefully at all circumstances to rule on residency.

It's never clear cut.





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17 Oct 2011 14:09 by johnzx Star rating in Spain. 3374 posts Send private message

Faro,
                     Thanks but my question was not about tax residency, which I am pretty sure I understand reasonably well,  that was an off the thread comment, introduced by a poster.
 
I started the thread to clarify how registering on the EU Foreign Citizens Register, for a person who does not intend to stay for more than 182, affects the things I have listed.



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17 Oct 2011 14:38 by Faro Star rating in London. 1156 posts Send private message

But is it not the decision of the individual to apply for residencia and thus change their status?

Most doing so do so becuase they wish to become resident for one reason or another or there is some benefit (possibly tax?) to be derived from the change of status.

But this is not unique to non-Spanish and there are many Spanish nationals who for instance have UK driving licences and can't be bother changing them etc





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17 Oct 2011 14:53 by johnzx Star rating in Spain. 3374 posts Send private message

But is it not the decision of the individual to apply for Residencia and thus change their status?  Residencia does not exist and has not done so since April 2007.   Since then any EU citizen, spending three month permanently in Spain, is obliged to register on the EU Foreign Residents Register.

Most doing so do so because they wish to become resident for one reason or another or there is some benefit (possibly tax?) to be derived from the change of status.  No, as I said,  it is not a thing which one can choose to do or not to do, unless they ignore the law.

But this is not unique to non-Spanish and there are many Spanish nationals who for instance have UK driving licences and can't be bother changing them etc  That is another matter, not included in the questions I posed.

 

 



This message was last edited by johnzx on 17/10/2011.

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17 Oct 2011 15:12 by Angar Star rating. 194 posts Send private message

¡que pesado!, you do not seem to accept the input from other members, so why dont you go to tax office, or town hall or police station and ask them?





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17 Oct 2011 15:24 by johnzx Star rating in Spain. 3374 posts Send private message

Angar, I have sent  you  a private message



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17 Oct 2011 16:08 by Faro Star rating in London. 1156 posts Send private message

John

Residencia still exists and you still need to go to police station and apply - the only difference is you don't get the residence cards you used to get?

I still think you are trying to look for precise answers which do not exist.

and unless you sell up in the UK and move lock stock and barrel to Spain then you are somewhere in between and that's why you need to look carefully at individual circumstances.

and if you ask the question to the appropriate authorities you will get the same vague response ....





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17 Oct 2011 16:21 by johnzx Star rating in Spain. 3374 posts Send private message

 

 

Sorry Faro, but since April 2007  Residencia has ONLY EXISTED FOR NON EUROPEAN UNION CITIZENS.

I say this as a volunteer translator working (for over 15 years) with the National Police at a police station with  a Documentation Office, assisting both victims of crime and applications for legal paperwork.  My own Residencia was not renewed in April 2007 and since then I have the 'worthless piece of green paper'  The Registration Cert.

 

I asked the specific questions as I have a friend who is affected i.e. more than 3 months permanently in Spain but less than 183 days per year.  Her  bank has frozen her non resident bank account as they say she is resident, but she is clearly not tax resident.

 



This message was last edited by johnzx on 17/10/2011.



This message was last edited by johnzx on 17/10/2011.

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