Are you a non-tax resident of Spain? Maybe you can request a refund. Check it.

Summary:

If you are a non-tax resident and have had any withholding in Spain, there may be certain tax refunds that you can request. Feel free to review this topic and see if you can benefit.

Published on February 19, 2021

Are you a non-tax resident of Spain? Maybe you can request a refund. Check it.

First of all, it is important to verify if you are a non-resident for tax purposes and if the Spanish Non-Tax Resident Income Tax Law, is applicable to you.

In general terms, it is acceptable to understand that you will be non-tax resident if you have been outside of Spain for at least six months during the calendar year and you have your economic means outside of Spain.

If you think you are a non-tax resident in Spain and therefore, tax resident in another country, make sure you will be able to obtain a Tax Residence Certificate issued by the Tax Authorities of your country of residence.

For applying for a tax refund, it will be mandatory to provide this Tax Residence Certificate of your country of residence, if possible, according to the meaning of a tax treaty signed with Spain.

Once the above has been verified, please note that as a non-tax resident in Spain, if you have born any tax withholding on your Spanish source-income, this is, obtained or paid in Spain and this withholding have been higher than the corresponding non-tax resident tax rate, you may request a refund.

For example, the non-tax resident rate corresponding to Spanish source employment income is 24% (19% in the case of residents EU, with the possibility of deducting certain expenses). Therefore, if a higher withholding has been supported, a refund can be requested.

In the case of other types of income such as interest, dividends or even capital gains obtained in Spain, it must be considered that a reduced taxation could be applied in accordance with the tax treaties signed between Spain and other countries or, they may even be exempt, or tax reduced, by the Spanish internal regulations (IRNR). Thus, it would be possible to request a refund.

Considering a sale of a property located in Spain, in which the buyer has applied the withholding of 3% provided by the non-resident tax law, it could also happen that said withholding is higher than the final tax and, therefore, a refund can be requested.

In any case, any situation would need to be previously reviewed.

How and when can you request a refund?

Refunds for Non-Tax Residents have to be requested filing a Form 210. A form must be prepared for each type of income or capital gain and you must not forget that a certificate of residence must be provided .

Form 210 can be filed as of February of the year following the accrual (that is, the year following the one in which the return or capital gain occurred). In any case, the deadline is up to four years from said accrual.

In the case of a gain or loss derived from the sale of a home located in Spanish territory, the deadline is four months from the date of sale.