Tax Declaration 2019, in Spain

Even “back home”, Tax Declaration can be hard.

Living in Costa Blanca, tax declaration can offer additional challenges. Therefore we will try to guide you and give you some pieces of advice, so the tax declaration will be easier for you.

Surely many of you have heard your friends talk about their Tax declaration or Income Tax. And many of you are probably up-to-date on Spanish tax obligations. But if you are not clear whether you should fill it out or not, TheCostaBlancaGuide has prepared a small guide for those who are not clear about it. If you have any doubt we advise you to have a talk with your gestor.

Working in Spain?

If you are a foreigner and work in Spain, you may be able to do the “Declaration para Impatriados” (declaration for expatriate employees). This is a Special Tax Regime for employees displaced to Spain. It allows paying according to the IRPF for foreigners residing in Spain instead of the usual IRPF. (IRPF: Impuesto Sobre la Renta de las Personas Físicas = Income tax on natural persons).

Beckham Law

In order to encourage the hiring of highly qualified people in Spanish companies, a Special Regime for Displaced Workers was created, or as it is legally called “Regimen Especial de impatriados” (Special Expatriate Employees Regime).

Foreign residents, to be able to declare their taxes, must have a series of characteristics to use form model 151. Answer the following questions and you will know if you can use this “Special Expatriate Employees Regime” directed at expatriate employees.

Have you previously resided in Spain?

You can not have resided in Spain during the ten years prior to your new stay in Spanish territory. This basically means that you can only do a foreign residents tax declaration if you have your fiscal residence in Spain without having had it in the previous 10 years. This means that you have been able to stay and travel to Spain during these years, but without being a resident and without having worked here.

Do you have a work contract?

The Spanish Treasury Department establishes that the displacement to Spanish territory must the result of an employment contract. This implies that this regime cannot be applied to those people who come to Spain to get a job since the cause of the displacement must be the existing work contract.

Where do you work?

In order to present your tax declaration using model 151, it is necessary that the work you have been hired for is carried out in Spain. Beware, this condition will be understood as fulfilled when part of the work is also provided abroad, provided that the sum of the money earned does not exceed more than 15%.

Is your company in Spain?

The company or entity you work for must reside in Spain.

If the requirements for the application of the “Régimen Especial de impatriados” (Special Expatriate Employees Regime) are met, the next step is presenting model 149 to the Tax Agency.

This step must be carried out within a maximum period of six months from the start date of the activity. The responsible managing tax office will issue the employee with a confirmation document. They will issue this document within a period of ten working days. It evidences that they accept the option for this special rule.

Remember that if you want to have more detailed information it is best to contact your gestor.