Becoming non resident in spain for tax purposes

I was reading on another ex pat forum, that a poster said he was going to become non resident as he had endowment insurances maturing soon. Unless he is returning to UK for more than 183 days this year and returning next, it sounds a bit dodgy, as to me it looks more like he is trying to be non resident in Spain while still living here, and then reverting to resident once he has received his payouts. How can this be done?

 Spam post or abuse? Please let us know

I do not understand the problem

The poster is correct that if you are in any country for more than 183 days in any fiscal year then you are automatically a resident of that country. A tax resident is something slightly different.

With regard to maturing endowments these are treated as being received in the U.K. with all U.K. tax deducted/paid for and therefore tax free. If the Spanish tax authorities think that they might be entitled to tax on these maturing policies then they should be advised of  dual taxation where tax that has been paid/deducted in one E.U. country can not be charged again in the second country.

Instead of listening to so called 'experts' on forums (including me) simply ask a QUALIFIED tax accountant in both countries and see what the answer is. This seems a much cheaper and more logical answer than upping sticks for 12 months.

 

 Spam post or abuse? Please let us know

What do you mean, a tax resident is something different?

Do you not automatically become both resident AND tax resident in Spain if you spend more than 183 days here?

I doubt whether most expats consider these matters on moving to Spain, and most experts never mention it in their articles in the ex pat press.

It's not my problem, but It is interesting to know the answer.This chap obviously didn't know they were paid out with tax already deducted-might have saved him a lot of trouble.Is it the same with retirement lump sums and compensation claims?

This message was last edited by camposol on 23/06/2013.

This message was last edited by camposol on 23/06/2013.

 Spam post or abuse? Please let us know

 Retirement lump sums are tax free while the annual pension is taxed - and it depends on the type of compensation.    A lot of compensation is taxed, but cases won for example for clinical negligence, are paid tax free.   The government would very much like to change that, putting a ceiling on what can be claimed, and removing the tax free status.  This is in the UK I am talking about.

 Spam post or abuse? Please let us know

"
I was reading on another ex pat forum, that a poster said he was going to become non resident as he had endowment insurances maturing soon. Unless he is returning to UK for more than 183 days this year and returning next, it sounds a bit dodgy, as to me it looks more like he is trying to be non resident in Spain while still living here, and then reverting to resident once he has received his payouts. How can this be done?"

I think you will find ( when he replies, and no it is not me) that he will be spending less than 183 days in Spain this year, and has de registered with the Hacienda. I also think, if you read some of the other threads about the 720 etc, that he will be remaining a non-resident and has his villa up for sale.

 Spam post or abuse? Please let us know

Steone

I'd be interested in your explanation of the difference between a resident and a tax resident.

With regard to your point about endowments, and UK tax and Spanish tax, then I think you need to read the double tax agreement, and if you still think you are correct, then post again.

 Spam post or abuse? Please let us know

"Steone

I'd be interested in your explanation of the difference between a resident and a tax resident.

With regard to your point about endowments, and UK tax and Spanish tax, then I think you need to read the double tax agreement, and if you still think you are correct, then post again."

 

so would I ! 

 

 

 Spam post or abuse? Please let us know

 Residency is a multi-concept legal word as it is true, every field has its own description of this.

So the question when inquiring about residency is: where? what country? to what effects? and then, you need to go to the specific legislation and find the correspondent description.

Commercial residency, tax residency, civil residency...

 Spam post or abuse? Please let us know