Fiscal Representation
By law a non-resident owner of more than two Spanish Properties should appoint a fiscal representative in Spain. Failure to do so may result in a fine of between 150€ and 6,000€. Those who only own one property in Spain are not obliged by law to appoint one, but it is in their best interest to do so.
Contact our English-speaking team for all your legal, property, and accounting needs.
Pérez Legal Group takes care of filing your non-resident tax declarations (Wealth and Income Tax), before the Spanish Inland Revenue. We will also keep you informed of any taxes you will have to pay now and in the future, according to the information in our files concerning the property/ies you own in Spain.
- Any non-resident individual owning a property in Spain is liable to the payment of both Wealth and Income Tax
- These taxes must be paid on an annual basis. If you bought your property in 2004, the year 2005 is the first year you have to pay your taxes. If you bought before this date, we are also able to update your taxes at your request.
- Should you fail to pay your Wealth and Income Tax to the Spanish Tax Authorities, upon the sale of your property in Spain, you will not be able to recover the 3% retention on the sales price made on account of possible capital gains tax. In other words the Tax Office will deduct your Wealth and Income Tax for the previous five years, plus accrued interest over that period of time and the corresponding penalty, from any potential reimbursement. The Wealth Tax rates cannot be from 0.2% to 2.5%.
- The Tax Office, in order to give a value to your property for the calculation of the Wealth Tax, will apply the highest of the following three:
- The value of the property appearing in the local rates (cadastral value).
- The purchase value as it appears in the Purchase Title Deeds or “Escritura de Compra-venta”.
- The Fiscal Value established by the Administration Office.
Any non-resident individual with a property in his name is subject to an Income Tax of 2% (or 1.1% if the cadastral value has been recently revised) on the value of the property. This tax is presently 25%.
The Inland Revenue deems that the owner of the property is receiving an annual income equal to 2% of its value and a 25% tax is applied on this amount. The valuation for the “Deemed Income Tax” is the cadastral value shown on the Local Property Tax (I.B.I. bill).
Pérez Legal Group can act as your Fiscal Representative, filing all the necessary forms and reminding you of payments due to the Spanish Tax Authorities. For the above mentioned concepts our fees will be 250€. However, it is the responsibility of the client to pay the annual taxed levied on your property.
The payment due should reach our clients’ accounts (bank details enclosed) before the first week of December of each year, otherwise we will not be responsible for payment with in the time limit established by the Tax Authorities, in order to avoid any penalty.
Local Property Tax (I.B.I. bill)
Pérez Legal Group can act as your Fiscal Representative, filing all the necessary forms and reminding you of payments due to the Spanish Tax Authorities. For the above mentioned concepts our fees will be 250€. However, it is the responsibility of the client to pay the annual taxed levied on your property.
The payment due should reach our clients’ accounts (bank details enclosed) before the first week of December of each year, otherwise we will not be responsible for payment with in the time limit established by the Tax Authorities, in order to avoid any penalty.
Need help understanding the taxation system?
Download the FREE Guide to Taxes for Non-Residents in Spain, written by Raquel Perez, owner of Perez Legal.
Are you buying a property?
Then you need to know the process. Download the FREE Guideline Procedure for Purchasing a Property.
Confused with the legalities of buying a home?
Download the FREE Spain Legal Buying Guide, written by Raquel Perez, owner of Perez Legal Group.
Selling your property?
Get an overview of what is involved by downloading the FREE Guide to Selling Your Spanish Property Legally.
Do you need help planning for the future?
Find out more information on the inheritance system here in Spain by downloading the FREE Inheritance Services book.
Do you pay taxes?
Download the 2019 Tax Payer´s Calendar to find the dates you need to submit your tax declarations.