Main Changes in the Income Tax for Non-Residents (Chapter two Law 26/2014 and Royal Decree 9/2015 dated 10th of July)
1. - Reduction in tax rates for non-residents.
Tax rates for non-residents with no business in Spain:
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2014
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2015
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From July 15 2015
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2016
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EU residents
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24,75%
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20%
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19,5%
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19%
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NON EU residents
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24,75%
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24%
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24%
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24%
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Capital Gains tax ( for all)
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21%
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20%
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19,5%
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19%
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2. International property reinvestment Spain-EU country:
From 1.01.2015, if a Spanish resident sells his home, where he has lived for more than 3 years and move to another EU country and buys a home with funds obtained on the sale of the Spanish one, there will be no capital gains to pay, neither, despite the fact that he would be a non-resident for that year.
If the reinvestment is partial, the exemption will also be partial
Take into account that from 2015 on, residents in Spain are exempt of capital gains if- as always- they sell their first residency and reinvest in first residency within two years or:
You are over 65 years old and:
a) Sell your first residency even if you do not reinvest in first residency.
b) Sell any real estate asset and invest these funds in a life annuity as a complement of your pension, with a maximum limit of 240.000 Euros
3. – Choosing Spain for Income tax
Nonresidents of Spain, who live in the E.U., who have worked in Spain, will have the option to pay the Income Tax as residents in Spain.
4. - Tax rate for “Permanent Establishments” of non-residents
Is reduced from 30% in 2014 to the applicable rate of tax for Spanish Companies (which will be of a maximum of 28% in 2015 and 25% in 2014)
- - Updating coefficient
On the property price at the purchase disappears, which will increase the tax on the capital gains in many cases.
- - “Coeficiente de abatimiento”)
Which reduced income tax for properties bought before 1994, December 31st is now limited to a total and unique accumulated figure of 400.000 euros per tax payer
- - IRNR drafts from Tax Offices
Non-residents who do not have a tax representative in Spain and pay their own taxes will have the option to ask the Spanish Tax Office to send them a draft of their IRNR to be paid.
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Any doubt with your NON RESIDENT Taxes….?
Tax Planning description and first year tax payments both for the price of one.
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Frigiliana, Malaga, South eastern Spain