money
11-17 OCT 2013
31
It’s never too early to talk taxes by
Suzanne O’Connell Customer Care at Ábaco
IF YOU live in the region of Torrevieja then you will know what I mean if I refer to the Christmas Shop. THIS PARTICULAR store a few minutes from the centre of Torrevieja has just opened for the 2013 season. For three months a year it satisfies the cravings of those frustrated by the lack of Christmas tinsel and trimmings in the Spanish shops. But it’s only October - why are we talking about Christmas? The early heralding of the Christmas season is something we have become used to in the UK. In Spain, however, the coming of Christmas is a much more low-key affair. Its equal positioning alongside other Christian festivals is, personally, something that I welcome. The good news is, if you feel differently, then the Christmas Shop will let you behave otherwise. To give even more of a Scrooge feel to the first hint
of Christmas, dare I mention ‘taxes’. In Spain, it’s not only Christmas that is ushered in at this time of year, it’s also the time of the non-resident tax declaration. It might seem a little early to be preparing in October for the 31st December tax declaration deadline. However, just as some of us like to get our homes decked out early, so in a firm that deals with taxes, we must prepare in good time too. NON-RESIDENT TAX CONFUSION It still takes us by surprise just how many nonresident Spanish property owners are unaware of their Spanish tax obligations. By and large they expect to pay the council tax (IBI) but do not seem to know that there are more taxes they should be paying. It’s doubly surprising because we have been telling people about them for years!
The one that often causes confusion is the imputed income tax. This is a tax on property that must be paid by non-residents who do not rent out their Spanish property. The thinking behind this tax is that your property in Spain is a second home. As such, if you don’t pay rental income tax, then you must pay this tax instead. It might be the reference to ‘income’ that non-residents find confusing. However, the imputed income tax is nothing to do with your income in the UK: it is purely a tax on property. The deadline for paying the tax is 31st December. Collecting taxes at this time of year might be a rather unseasonal activity but then the tax man doesn’t have a reputation for fun and festivity. So, as you’re sifting through last year’s Christmas trimmings spare a thought for us in Spain, sorting through your nonresident taxes: ‘Season’s Greetings!’
Ábaco provide fiscal representation to non-resident and resident Spanish property owners. You can contact us for free advice and information by calling our helpline 96 670 3748 or visiting our website www.abacoadvisers.com