Reporting of Assets Outside Spain and UK Rental Income.

Actually, Having just had my form done by the tax accountant, it's not as black and white as it appears, and some things that you think have to be included on the form don't have to be, and everybody's situation is unique, particularly in relation to bonds.

what I did wonder is, many of us have had lots of different accounts over the years, some we may have forgotten about, some we might  not have any documentation for, some we thought were closed may be still open with a tiny amount in;what happens if they get sniffed out. Surely it is reasonable to declare everything we can remember, but if there are accounts in our past, ones that we don't realise we still have, it would be unfair to penalise anybody, and it would be obvious we are not trying to hide an account with say £1 in. Obviously if it's thousands it would be suspicious. I do think people have been scare out of their minds over this.Although its possible to trace lost accounts with tracing sevices, it is a long business and too late now.

How can anyone not know of this law, with the vast amounts online and in the press?

Can any clarify the position regarding those who are self employed in Britain, resident here and paying taxes in Britain?

Do such people require to inform the Spanish authorities of property owned in the UK that forms part of the self employed business?

We have been informed that as self employed people and also as former UK government employees, we are within our rights not to make this declaration.

We know that everyone's situation is different but would be grateful for input.

Tamaraessex - Yes I tend to agree with you, especially as Wikipedia states the following... ' National Savings and Investments (NS&I), formerly called the Post Office Savings Bank and National Savings, is a state-owned savings bank in the United Kingdom. It is an executive agency of the Chancellor of the Exchequer '. Why didn't I think of looking there myself, however it just goes to show how confusing it has all become and David Searle is a well respected author of many articles on life in Spain. Perhaps this will put an end to where Premium Bonds sit, although I don't know if National Savings has a BIC or IBAN code.

With the advent of online banking, it is understandable why people have so many bank accounts, for me I kept them in place just in case I ever needed them, so much easier to use an existing account than to go through the rigmarole of trying to open a new one, especially as interest rates varied from account to account and normally for restricted periods... you had to move to new accounts to obtain better interest rates.

Despite the amount of press coverage on the subject, yes I'm afraid there are some people who still haven't heard about the law or maybe they just don't want to.

I think I've said this before, but I have many aquaintances who for want of a better word ' don't really live here '... yes they do, but through either fear or ignorance they do nothing about registering for tax residency in Spain, I'm sure we all know someone who qualifies in this area. I'm even more amazed about the number of people who state that because their income is generated in the UK, they pay their tax in the UK !.

Fortunately most of the people who contribute to this thread are seeking to understand exactly what is required to be reported and where it should go so that they do not accidently fall foul of this law.

Lifeline - Firstly, as far as I can see this law is for those who are tax resident in Spain, although it may include people who are not, but who should be.

If you reside here I think it best to check whether you should legally be tax resident in Spain if you spend more than 183 days here, this is only for starters there are many other points that could make you tax resident in Spain. My view has always been that you pay tax on your worldwide income where you reside. 

if owning property in the uk and being a resident in spain  (not just yet) and having to declare assests over 50k. can soeone tell me if the uk property is owned by several people not all spanish residents, is the tax burden on the spanish residents the full amount of the uk property or is it shared amongst all the owners? just a thought 

on another note how come when I try to use a smiley I can't post the message as this comes up in red

'ERROR! You cannot include web or email links until your account has been approved. Please remove the web or email address and then submit this message again. '

Kathyslad-I have yet to meet with the accountant to see how my form has been presented.I do know that she has contacted the Hacienda with various queries about the form, as I imagined many have, being a totally new law.Therefore I have to trust her judgement, as I could never have done it on my own.Anyway, she assures me not to worry .

bobaol-I haven' got loads of old accounts. I remember an old post office account which I'm pretty sure I closed, but wondered if it was still in existence with a tiny amount in.I have also had building society accounts which have been closes. Perhaps the scary prospect of  fines can mke us paranoid!

Some people may have forgotton the existence of premium bonds-you used to be able to buy them for a pound each. It's quite possible  they are lurking in a drawer somewhere-surely they wouldn't be penalised if they came to light, and indeed why would they?

This doesn't affect me but if it did I really wouldn't be so worried and I can't help thinking there is some over reaction. It's assets over £50,000 in whatever groups, so surely old post office accounts with 5 bob in and a couple of forogotten £1 premium bonds don't count anyway. This will be to catch the big fish so please stop fretting!

Wencra

                   can someone tell me if the UK property is owned by several people not all Spanish residents,

The declaration for those tax resident in Spain (of assets of 50,000€ +) has nothing to do with tax.   At present, anyway,  it is just to declare one's assets outside Spain.

Of course if you have an income outside Spain, say in UK, then with the exception of Former Government Employee pensions, and rental income from UK property (the later maybe taxable partly in UK and partly in Spain)  all the rest is taxable only in Spain..

Thus a UK State Retirement Pension,  private pensions, Premium Bond winnings, etc.   are taxed ONLY IN SPAIN.  One cannot choose where they are taxed.

When making the annual income tax return, the exchange rate to be used for pensions and other income is the official rate for the year as  published by Hacienda/Bank of Spain.  (I have posted the table of rates on a separate thread)  but for the year 2012 it was 1.2253 euros to £1. 

However, if the income is received directly into your bank account in Spain then the actual amount received in Euros each month,  needs to added up.  If it is paid to a UK bank in UK the official rate for the year must be used.

Poppyseed
This doesn't affect me but if it did I really wouldn't be so worried and I can't help thinking there is some over reaction. It's assets over £50,000  (IN TOTAL)  in whatever groups, so surely old post office accounts with 5 bob in and a couple of forogotten £1 premium bonds don't count anyway. This will be to catch the big fish so please stop fretting!

 Thank you for your replies.

The reason I asked is that I attended a seminar, run by our urbanisation Administrators, to which a British firm (which also operates in Spain) were providing information on the new ruling. Initially they said that the law states that all residents who have property with a purchase value over 50K would be required to declare that property etc. But later said that while the law might say one thing the reality wasn't quite the same. So I asked about my position as a property owner in the UK, taxed there as a self-employed person, as opposed to filing a personal tax return, to which he said that I didn't come under the requirements of Spanish law with regard to paying taxes here. As I wasn't a Spanish tax payer I couldn't declare property either as only those who are tax residents are required to do. 

The other issue was regarding superannuation pensions from former government empolyment that have tax deducted at source - to which he said, again, that there was no need to declare that income to the Spanish authorities.

Lifeline

The declaration is for those who are tax resident in Spain

If you are not,  then it does not include you.

 Thank you JONZX, that was my understanding.

It is a law that eventually will be added to the wealth tax and may cause Brits to think again about living here for more than 6 month per year.

Lifeline - Jonzx is right,  this law only affects those people who were tax resident in Spain for the tax year 2012 - 1 Jan 2012 to 31 Dec 2012 - so it looks for now as if it won't apply to you...  but you clearly need to establish whether or not you are actually tax resident in Spain, according to the rules, for the future.

As I said earlier,

' Lifeline - Firstly, as far as I can see this law is for those who are tax resident in Spain, although it may include people who are not, but who should be.

If you reside here I think it best to check whether you should legally be tax resident in Spain if you spend more than 183 days here, this is only for starters there are many other points that could make you tax resident in Spain. My view has always been that you pay tax on your worldwide income where you reside. ' 

On the comments as to whether or not to report a bank account,  that is entirely up to the individual, as far as I can see there is nothing to say that you can pick or choose, or that anything below a certain value need not be declared.

For those of you who remember 9th January, 2008, the day that the Junta of Andalucia demolished Len and Helen Prior's home in Vera, I can only quote - from memory - the clerk of works words at the time, ' They will see that we do things properly in Andalucia '... the one single act, that in my view, contributed to the downfall in the investment potential and long term economy of Andalucia.

I for one will report everything, no matter how small - only my personal view and opinion on what I'm going to do - if you think I'm over the top, that's up to you, this affects everything I've worked for in my life and I do not intend to jeopradise it on a technicality.

Clearly we all have different views, but I would rather argue with a UK tax inspector any day, than take on a Spanish one.