Returning after 6 years in UK

Hi, I wonder if anyone can help. I lived in Spain for just over 6 years & have Spanish residency. Moved back to to UK for 6 & hoping to return to live once again at the beginning of December. Renting long term. Obviously Brexit on my mind. I heard that Spain will grant residency rights or maybe a foreigner id card to UK citizens.

My question really is, would i qualify for these if not in Spain when & if Brexit happens or would I need to be already living back in Spain? Also does the fact that i left 6 years ago have any bearing on my already obtained residency? Thank you Karen

When you moved out of spain you should have cancelled your EU Citizens Registration in spain.  Had you done that if you move back then you would need to register again quoting your NIE.

if however you never cancelled the registration, unless the authorities discover you left spain then your reg cert is probably ok

Being resident in spain means you are taxable on your worldwide income, required to declare on form 720 any assets over 50,000 euros held outside spain, for example a property in U.K.  Thus Hacienda may chase you up for taxes etc during your period away

Thanks. Certificate was never cancelled as always knew I wortld return to live there again, although longer than I had hoped.

Another question regarding taxable income. I am retired but not of pension age yet so no income. My husband works offshore so only comes every 3 weeks & then back to work in the UK for 3. He doesn't have residency & will not reach retirement for another 5 years. 

What is that situation regarding paying taxes in Spain? Thanks Karen

Karen.  If one’s spouse lives in spain, from what you say on paper you do, then your husband is deemed to be tax resident in spain ever if he hardly ever even visits spain.  It would appear as you appeared to be resident in spain your husband would have been regarded as being tax resident spain.   As I said you may have difficult question to answer if Hacienda become interested 

In June this year Hacienda demanded proof of my OAP income for the year 2014. I had declared that income correctly.   I am 

Karen.  If one’s spouse lives in spain, from what you say on paper you do, then your husband is deemed to be tax resident in spain even if he hardly ever ever visits spain.  It would appear as you were resident in spain your husband would have been regarded as being tax resident spain. Under the double taxation agreement 2014, there is no choice where one pays their tax. As I said you / your husband may have difficult question to answer if Hacienda become interested 

Example of hacienda vigilance. In June this year Hacienda demanded proof of my OAP income for the year 2014. I had declared that income correctly.   I submitted my bank statements for that year showing my pension which is paid by DWP directly to my Spanish bank. I am still waiting to hear from them if they require further info.

I have had a similar problem. The Hacienda demanded documents from 2015 in my case on income correctly declared in Spain but generated in the UK.

I contract a professional tax advisor who has done all my tax business for years. They informed me the Hacienda are systematically examining all UK residents with income from outside Spain with a microscope and requesting further clarification. The cause, so it was explained, is the fixed exchange rates for Sterling/Euro used to calculate the original tax paid in Euros. It seems they were too generous and now are clawing tax back. I had to pay an additional €120 to them to sort it out. Not had any additional tax bill as yet but you can be sure they will demand some form of payment.

Although the posters spouse earns his money offshore I think you may find he is deemed to be a Spanish resident for tax purpose. Unless there was any marital separation in place. You have to pay income tax somewhere which means also you have to have a residential status somewhere as well. You cannot any longer be deemed a fiscal nomad.

John is right you or rather your husband risk receiving large tax bills for the years you did not inform the authorities you were in the UK. They will still consider you Spanish residents.

In some cases, two countries could consider you a tax-resident at the same time, and both could require you to pay taxes on your total worldwide income. Fortunately, many countries have double tax agreements, which usually provide rules to determine which of the two countries can treat you as a resident.

As you say there are agreements between many countries regarding tax liabltiy 

The one between U.K. and spain is the double taxation agreement 2013 (not 2014 as I said)

see:-  https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/507409/spain-dtc_-_in_force.pdf

It is true that you do not have to be tax resident somewhere but, unless you know intimately the tax residence rules of each country in which you spend time, you can be caught out. Many countries deem you to be a tax resident even when you spend fewer than six months a year there.

Thanks all, a bit of a minefield & I didn't realize about the tax laws as thought they only applied  if you owned or rented out a property, neither of which applies in my case as I have always just rented long term. Thanks Karen

Hi Karen, you need to appreciate that every taxman and tax authority in most of the world is a scavenger and will go after anyone like a bloodhound. They will abuse laws as if they don’t exist, and at times are above the law making up fantasy assessments and using abusive threats of what they will do if you do not pay. You could be a vulnerable person or seriously ill on your death bed, they will have no concern or conscience about their thug behaviour.

One thing for sure is that the onus is on you to prove any fantasy or malicious assessment is wrong. Guilty until you even attempt to try and prove your innocence. Completely against all human rights.

That's a tad harsh Kavanagh. Tax authorities like everyone else have to operate within the systemic laws of the country.

The OP seems not to understand that it matters not what you own or how you live in a country. Tax liability is based on principle residency. Since the Hacienda know the fundamental truth that to live you require income that takes you into the need under the law to pay a percentage of said income to them. 

If you are a foreign resident in Spain you are required to submit a tax return annually detailing your worldwide income and assets and any foreign bank accounts containing more than €50k. That applies equally to the OP's spouse unless they can prove separation or he declares in another country with a double taxation treaty. In that event, he needs to still submit the detail to receive a negative assessment from the Hacienda.

Windy, it may sound a tad harsh, but I have been involved in several tax investigations by HMRC, and they are ruthless. They make up a ridicules unproven demand and it is up to you to prove them wrong.

Most people do not object to paying what they owe, but HMRC seem to have a licence for extortion and abuse, and I expect the Spanish authorities are much the same.

Don't go into battle with the French tax authorities. You will need a suit of armour. 

Micky. Just to clarify.  

Everyone tax resident in Spain who comes within the requirements is obliged to submit a 720 not just foreigners.  For most that does not mean more tax but when they die Hacienda now know about assets they held outside spain, whereas before the 720 they probably did not,  thus more likely they will look for more inheritance tax. 

Yes John, tell that to the 1,000s of homeless beggars.

"Yes John, tell that to the 1,000s of homeless beggars."

I said     "Everyone tax resident in Spain who comes within the requirements "     so those with assets of  50,000 €  or more, in any of the three groups, outside Spain

Sorry did I get that wrong ?

No John you are correct. There is a rule that says if your income is below a certain level ie: tax-exempt, you do not need to submit a tax return annually. However, foreigners with income from abroad do not come in that category even if their income is low and below the thresholds. Property ie: houses etc together with the value outside Spain has to be declared as well as Form 720 if you own more than €50k.

You can speculate on the motives but its only bringing Spain into line with most other countries. People got away with tax evasion for years in Spain but things have radically changed.

One day Micky Spain and other greedy taxation countries will kill the goose that lays the golden egg.

There are many tax free countries like, The United Arab Emirates, The Bahamas when not flooded, The British Virgin Islands, Brunei, The Cayman Islands, Monaco, Oman, Turks and Caicos, Vanuatu.

Hi, thanks all. I left Spain in July 2013, shortly after the new double taxation came into force, in March that year so does that mean that I may only owe a few months tax or would they seek it for a full tax year. Thanks Karen