New to it all

Hi wonder if someone can help me understand what spanish withholding tax is? The company that is renting our property out is wihtholding 24% of the rental for taxes.

Also how and when do I need to file spanish tax returns in Spain - I am being quote 350 euros from someone to file them for me but in the UK I file my own - is it easy to do this yourself in Spain or do you need to pay someone to do it for you.

Apologies for the simple questions but am totally confused

LMT

Hi LMT,

You have to pay tax on any rental income, so he is just withholding that from you to pay them.

Phil

Taxes in Spain are paid in arrears, this year you will be paying tax for 2008.  As a non resident you have to pay income tax (La Renta) even if you don't rent out your property.  As you do rent then the amount you pay is deducted from the rental you receive.

Personally I wouldn't be happy if my agent was keeping 24% back from your rental.  Paying tax is your responsibility not there's and I'd be concerned that I could loose that money if they went bankrupt or disappeared with the money.

You can deal with your own tax affairs, I'd suggest you read "You and the Law in Spain" and decide.  I believe Amazon stock this or any of the large bookshops around.

As to the cost quoted for dealing with your tax affairs, I think it's steep.  If you tell us the region your property is in I'm sure someone will be able to recommend a gestor who would be cheaper.

If the property is owned in joint names then each person named has to file a tax return, that can bump up the price.

 My lawyer charged 50 Euros each to fill in the form. We don't rent ours out so was very simple. However, I can't believe it is that much more difficult if you rent out. You pay a straight 24% of the rent you get. I believe you are not allowed to make any deductions for your costs!