do they actually catch up with non payers of wealth tax?

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sick and tired
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do they actually catch up with non payers of wealth tax?

Postby sick and tired » Thu Jan 15, 2009 11:17 pm

probably one for beach .i have paid the wealth tax on time every year and paid extra for having the privelage of a third person completing the forms,mainly did not want to make a mistake and cause a problem as i am not resident although visit a lot did not want to waste my relax time in tax offices speaking my poor spanish.the point being i know loads of non residents who have just ignored this particular tax for at least 5 years,now am i a mug for paying or do the spanish eventually catch up and are the sanctions severe,i have to say i do not know anyone who has been caught.i also know a guy who has had a property 5 years and never paid a penny to the town hall or received a bill.he bought through a reputable solicitor and would of expected to have been registered at the local town hall again is there a real threat of back bills??i have always liked to keep everything above board but you do sometimes think have you been a mug??

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Re: do they actually catch up with non payers of wealth tax?

Postby Beachcomber » Thu Jan 15, 2009 11:31 pm

It is apparent, with the drastic reduction in revenue,that underworked tax officials will be going through the records comparing the names and NIE numbers of purchaser with those who have, or have not, paid their taxes in an attempt to make up some of the shortfall.

This is an easy cross-check to make as you come into the sights of AEAT as soon as you pay your transfer taxes on the property and remember that AEAT can go back for four years claiming not only back taxes but imposing fines, surcharges and interest for non-payment. The fact that wealth tax has now been abolished does not mean that they cannot claim it for the past four years along with the notional income tax.

I think the tax dodgers are in for a big shock and that people who, up until now, have not paid should seriously think about doing so.
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Re: do they actually catch up with non payers of wealth tax?

Postby hillybilly » Thu Jan 15, 2009 11:37 pm

I know plenty of people both non-res and resident who have never submitted a tax return here and think I am mad for doing so. Some I'm sure don't know of their obligation to do so (and, I'm convinced, don't believe me when I tell them otherwise), others would just prefer "not to bother".
I know of no-one who has (so far) been "caught up" with. I suppose they may only get their comeuppance if and when they sell a property.
Personally I prefer a clear conscience...

Edit: in fact, thinking about it (which I really shouldn't!), NONE of my friends/acquaintances has ever submitted a tax return...

Edit #2: (I shan't sleep tonight now for all this thinking!) some friends who have gone for 5 years without paying tax, IBI, water or electricity DID receive a small comeuppance very recently when somebody from the town hall came to the door with a backdated water bill for over 1000€ :shock: Maybe the "catching up with" has begun...
Last edited by hillybilly on Thu Jan 15, 2009 11:45 pm, edited 2 times in total.

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Re: do they actually catch up with non payers of wealth tax?

Postby gus » Thu Jan 15, 2009 11:40 pm

I'm with you Hilly :-)

Paying tax is bad enough but when they start adding fines and interest............

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Re: do they actually catch up with non payers of wealth tax?

Postby Beachcomber » Fri Jan 16, 2009 12:06 am

It wasn't 'catching up with' exactly but a friend who recently sold a property as a non-resident and who has been submitting her non-resident tax returns religiously since purchasing the property was told that her claim for the refund of the 3% retention made on the sale of the property would only be considered once she had submitted her non-resident tax return for the previous year and the deadline for submission (31st December) hadn't even been reached at that stage.

My wife was recently fined €80 for late submission of an annual IVA return on which no payment was due (it just serves as a balancing of the books for the previous year's IVA returns) despite the fact that we had presented it within the deadline. The bank was unable to process it because of a computer problem but stamped the form to show we had submitted it within the deadline. AEAT would not accept the stamped form as proof of submission within the due date hence the fine.

So this was €80 for the alleged late submission of one return. Because there was actually no payment due there were no surcharges or interest to pay but if there had been this could have amounted to hundreds if not thousands of euros.

There was another instance some time ago when an acquaintance had sold a property and was told by his lawyer not to bother to claim back the retention because retentions were never repaid and it was a waste of time. Well, apart from the fact that a capital gains tax return has to be submitted anyway the retentions are repaid if they are due and applied for properly.

We subsequently submitted the CGT return and claimed back his retention of the equivalent of several thousand euros but warned him that he may be fined for late submission of the return even though it was for money being held by AEAT that was due to him.

Sure enough when the retention was repaid they had deducted 25.000 pesetas (about €150) as a fine for late submission of the return. He obviously wasn't worried about this as he had got back a considerable some of money that his lazy toe-rag of a lawyer had told him to write off but it does demonstrate the trouble you can get into if you don't play the game with a straight bat.
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Re: do they actually catch up with non payers of wealth tax?

Postby hillybilly » Fri Jan 16, 2009 8:55 am

Fined for being late in reclaiming your own money :roll: They'll get you any way they can.
The sad fact is that none of this surprises me really any more!
I wonder why there isn't more publication of information here? If AEAT were to send leaflets out once in a while reminding people of their obligation, more people might pay. Maybe they do do this, but I've never received anything, only ever seen newspaper or billboard ads. In the UK one could build a bonfire with the stuff that used to come from Inland Revenue.
Mind you, having dealt for years with UK Customs & Excise, who I'm convinced would have carried out execution orders for late payment if they were allowed, I just take the stance that you don't/can't mess with any of these guys.

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Re: do they actually catch up with non payers of wealth tax?

Postby Jool » Fri Jan 16, 2009 9:44 am

I agree with you Hilly and Beach. My biggest gripe about Spain is that every individual is expected to be psychic and to read every single possibly relevant boletin every day, if you don´t know something woe betide you, yet try and find out what you need to know and you are dealing with other people who also mostly don´t know the true picture!! How can you ask a question if you don´t know the questions to ask? I know people who have checked info with their gestors only to find they know more, from the forums, than the supposedly qualified gestor does.......and these are well regarded gestors usually seen as reliable.......so even they do not keep up........what hope have we.

Even though I speak spanish and think everyone who moves here to live should also learn, I have to say that there are thousands of non resident spanish property owners and so why doesn´t the tax office lsit the info re taxes and tax responsibilities in english?

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Re: do they actually catch up with non payers of wealth tax?

Postby Beachcomber » Fri Jan 16, 2009 10:30 am

Well, for non-resident information in English you could try here but the only relevant information concerning the non-resident tax we are all concerned with is a few lines on page 13 of a 40 page document and that's out of date anyway because it still refers to the payment of wealth tax.
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Re: do they actually catch up with non payers of wealth tax?

Postby ashtondav » Fri Jan 16, 2009 10:38 am

I too am non resident and i rent my apartment to holidaymakers. I pay all taxes including the punitive quarterly tax on rental income with no allowance for costs or mortgage payments.

Of the 20 or 30 people i know who rent out their apartments nearly all pay wealth tax - virtually none pay tax on rental income. Wealth tax is usually not large, rental tax is nearly always larger.

I know of no one being caught up for:
- black money payments on purchase
- non payment of wealth tax
- non payment of rental income tax.

It sometimes really annoys me to hear them crowing about how 'clever' they are and how 'stupid' i am.

When i first rented out even my lawyer looked at me as though i was insane and said "all your rentals are in Sterling - yes? Why do you want to bother declaring tax here?"

Based on all the responses in this thread, the chances of being caught or detected are minimal. As usual the rewards go to the dishonest, the ignorant and the forgetful...

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Re: do they actually catch up with non payers of wealth tax?

Postby Jool » Fri Jan 16, 2009 11:32 am

There have been a few cases of black money catch ups over here in Almeria and they are targeting rental income but the big problem is if the owners live in the UK its hard for the Authorities to track them apparently, even though it is surely not difficult...............

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Re: do they actually catch up with non payers of wealth tax?

Postby Paula » Fri Jan 16, 2009 12:06 pm

I often wonder how many non residents are actually paying wealth tax. It would appear that every non resident that I speak to friends or otherwise are not :shock: It would also seem that many people are not actually aware that it exists, then when they do find out about it they are of the opinion that nobody has chased them so let sleeping dogs lie. We didn't pay the first year that we had properties so had quite a chunk to pay the 2nd year when we found out that it was applicable to us. I'd rather sleep at night, and to be honest I wouldn't feel clever for getting away with it I'd feel a bit of a fraud! Who knows whether they will all get away with it now that it has been abolished, but I wouldn't want someone knocking on our door with a massive bill going back years and that has to be a real possibility.

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Re: do they actually catch up with non payers of wealth tax?

Postby Beachcomber » Fri Jan 16, 2009 1:02 pm

I know that I repeat this with regular monotony but please remember that it is only the wealth tax content of the non-resident taxes that has been abolished. The notional income tax is still payable.

Just because wealth tax has been abolished it does not mean that AEAT will not fine people (if they catch them) who have not paid the tax for at least the past four years.

See my post below.
Let's go Brandon!

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Re: do they actually catch up with non payers of wealth tax?

Postby oliveview01 » Fri Jan 16, 2009 4:34 pm

We had always paid our tax when we were non residents, even though we never rented out the house, we had to pay tax as if we did! We had friends with a holiday home out here who bought using the same solicitor as us, they were never asked for their tax!
Now we are residents we fill in our tax returns. Hubby went last year to do his tax return with the solicitor who did the return the year before and was told that as we paid tax in the UK there was no need to submit a tax return here, as we had no income in Spain.
The UK tax man owes us money, 3 letters and almost a year later we are still waiting :x

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Re: do they actually catch up with non payers of wealth tax?

Postby ashtondav » Fri Jan 16, 2009 4:35 pm

But it looks as though no one is ever caught...

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Re: do they actually catch up with non payers of wealth tax?

Postby costapacket » Fri Jan 16, 2009 4:35 pm

Beachcomber wrote:I know that I repeat this with regular monotony but please remember that it is only the wealth tax content of the non-resident taxes that has been abolished. The notional income tax is still payable.

Just because wealth tax has been abolished it does not mean that AEAT will not fine people (if they catch them) who have not paid the tax for at least the past four years.

See my post below.
Has the wealth tax actually officially been abolished now?

I know it was an election promise but have the necessary laws been passed now?

I will be very relieved if it has.

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Re: do they actually catch up with non payers of wealth tax?

Postby El Cid » Fri Jan 16, 2009 4:39 pm

oliveview01 wrote: Hubby went last year to do his tax return with the solicitor who did the return the year before and was told that as we paid tax in the UK there was no need to submit a tax return here, as we had no income in Spain.
Yet another useless solicitor.

He should know that if you are resident permanently in Spain you are liable for tax on your world wide income.

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Re: do they actually catch up with non payers of wealth tax?

Postby Beachcomber » Fri Jan 16, 2009 5:06 pm

costapacket wrote:Has the wealth tax actually officially been abolished now?
Yes:

http://www.boe.es/boe/dias/2008/12/25/p ... -52024.pdf

Article 3 on page 52010 refers to a 100% discount on the amount to be paid. It does not appear to differentiate between residents and non-residents.

Artículo tercero. Modificación de la Ley 19/1991, de 6 de
junio, del Impuesto sobre el Patrimonio.
Se introducen las siguientes modificaciones en la Ley
19/1991, de 6 de junio, del Impuesto sobre el Patrimonio:
Uno. El artículo 33 queda redactado de la siguiente
forma:
«Artículo 33. Bonificación general de la cuota íntegra.
Sobre la cuota íntegra del impuesto se aplicará
una bonificación del 100 por ciento a los sujetos pasivos
por obligación personal o real de contribuir.»
Dos. Se derogan los artículos 6, 36, 37 y 38, y la disposición
transitoria.
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Re: do they actually catch up with non payers of wealth tax?

Postby costapacket » Fri Jan 16, 2009 7:41 pm

That's great, thanks 8)

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Re: do they actually catch up with non payers of wealth tax?

Postby toddcl » Sun Jan 18, 2009 8:46 pm

He should know that if you are resident permanently in Spain you are liable for tax on your world wide income.
I was under the impression that Spain has an agreement with UK that a UK person resident in Spain can pay tax on his UK earnings, bank interst, pension etc that evolve from the UK, to the UK taxman, but has to inform the spanish tax man. :?:
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Re: do they actually catch up with non payers of wealth tax?

Postby hillybilly » Sun Jan 18, 2009 9:19 pm

If, for some reason you had no option but to pay tax in the UK (eg employer deducted), then as a Spanish tax resident you would still be obliged to complete your annual resident tax return here, prove what income has been received in the UK and what tax has been paid on that in the UK, add on all other worldwide income (ie Spain and wherever else you may have income from) and then pay tax on that and any difference that may be due in Spain as well.
Dual taxation agreement, so you don't pay twice but aren't exempt from paying any difference due here. But you can't choose where to pay your tax, that is determined by where you are tax resident.


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