Non-Resident Tax and SUMA

We wish to advise all our clients that the last day for payment of non resident tax  (it is paid a year in arrears) is 1st December.

This is due to the fact that, not only do we need to prepare the tax return forms, the bank has a large amount of taxes to pay at this time and they are taking a long time to give them back to us paid, so it is not possible to deal with this in December and be in time.

Any taxes not paid can obviously be paid in January, but will not make the cut-off point of the tax year, thus will incurr a small penalty.

One reminder for next year: when we have emailed people regarding their non-resident taxes, many have ignored the email and when we have spoken to them about it, they have said, “But it already comes out by direct debit in September”.

IBI/SUMA

This is a confusion with the IBI (or in this area – SUMA), which is basically council tax. This is a local tax used for maintenance of infrastructure, parks and leisure areas,  paid once a year for the current year and most people have a direct debit set up, which takes the money out in mid September in our area (Orihuela Costa).

If for some reason,you have NOT been paying this tax, this is very serious and please contact us as we urge you to contact us to get up to date, as at some stage an embargo on your car, or your bank account, or your house will appear.

Non-Resident Tax

However, this is a completely different thing from non-resident tax, which is an individual income tax return that all owners of property in Spain are ALSO required to pay, by law.  Many people do not realise that regardless of whether or not their property in Spain is rented out, they have to pay this tax individually each year.  But you only have to google these words and you can see it is clear that it is a legal obligation, and if you are not paying, at some stage, you will receive a very nasty suprise.

Joint Co-Owners and Renting

When a property is owned by a married couple or various different people, each person listed on the Title Deeds is defined as an independent tax payer, which means that an individual tax return must be separately filed by each of the co-owners.

If the property is only used by the owner and not let, the tax is based on an estimated income of the property´s cadastral value. The Return has to be presented and paid by 31st December each year, for the previous calendar year, so a year in arrears. If the property is rented out, this tax is payable, but also a separate tax based on rental income.

If you have never paid these and need some advice, please contact us.

You may find that to put things right does not cost as much as you may imagine, and will save you many a sleepless night when you realise that eventually non-payment of these legal obligations will cause problems.

If you have never paid this tax the tax office only requires you to pay for the past five years, the rest are exempt.