Wednesday, February 4, 2009

Tax Advice for Spanish UK Residents

If you are a UK citizen living in Spain (which many do these days), you may need to get proper Spanish tax advice to avoid having complicated problems later down the line. You need to define the country in which you are legally required to pay your income tax, for Spain, if you are resident for over 183 days per year you need to declare your world-wide income. In the UK you need to provide proof that you are actually living in Spain, before being relieved of UK income tax obligations (a form FD9 Spain/Individual is what you need). In Spain the limit where no deductions are made is 10,000 euros and the minimum tax rate is 24%, the minimum tax allowance is 5,050 euros per year which rises by 900 euros per year for every year over 65 (up to 75 after which it goes up by 2,000 euros per year). If you are in any doubt, get some decent Spanish tax advice from an accountant (Spanish) who knows his stuff, this will save you a headache later on in life.