Tax returns for pensioners
Tax returns for pensioners
Friends of ours living over here 3 years near Gaucin ( both over 65 and have residency and small property) receive their state pension paid into their Spanish bank account. They also have a very small private pension with tax deducted at source in the UK.
Do they need to complete an annual tax return in Spain? I assume they do, even though their annual earning are low, to be fiscally resident, but I'm not a tax expert and others expats have told them differently.
Do they need to complete an annual tax return in Spain? I assume they do, even though their annual earning are low, to be fiscally resident, but I'm not a tax expert and others expats have told them differently.
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The rules on who should declare are a little ambiguous but a family income of more than 10000 euros must be declared. In some cases the figure can be as low as 1000 euros.
All their income should be liable for tax in Spain. The private pension should not be taxed in the UK unless it is a government pension. It is easy to get it paid free of UK tax if the correct forms are submitted to both the UK and Spanish tax authorities.
For last year the basic UK pension for a couple was in excess of 10000 euros so most pensioners would have needed to make a declaration.
Currently the allowances against tax in Spain for a pensioner couple total just under 13000 euros so no tax would be due unless there was additional income.
So, to answer the original question, yes they should make a tax declaration in Spain and, as Beachcomber pointed out, that makes it easier to prove tax residency and get the considerable benefits with regard to CGT and IHT.
Sid
All their income should be liable for tax in Spain. The private pension should not be taxed in the UK unless it is a government pension. It is easy to get it paid free of UK tax if the correct forms are submitted to both the UK and Spanish tax authorities.
For last year the basic UK pension for a couple was in excess of 10000 euros so most pensioners would have needed to make a declaration.
Currently the allowances against tax in Spain for a pensioner couple total just under 13000 euros so no tax would be due unless there was additional income.
So, to answer the original question, yes they should make a tax declaration in Spain and, as Beachcomber pointed out, that makes it easier to prove tax residency and get the considerable benefits with regard to CGT and IHT.
Sid
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We're in a similar position to other pensioners - income less than allowances here. We didn't submit a return, but reading this, I think we ought to. But I know the annual return has to be in by end of June, or you have to pay a fine. Are you still fined if you make a late return if you don't owe any tax?
AlisonB
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