2015 resident tax error - allowances calculation?

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fyfin
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2015 resident tax error - allowances calculation?

Postby fyfin » Fri Dec 20, 2019 7:50 pm

Like many people here in Andalucia or possibly Spain, my friend has received a letter from the Spanish tax office, and it was the same accountant who did his return that had messed mine up re annuities.
He is receiving a demand for over €2,000 which is a bit of a shock and he's been to another practice (the previous "accountant" returned to UK). They told him it was down to exchange rates but that didn't seem right to me, so I had a look at the letter and the reconciliation.
It was immediately obvious that the accountant had entered £ sterling and done no conversion at all so a significant difference especially in 2015 when the average rate was €1.3765 (according to Hacienda and close enough to the figure I used)
However, I have tried to understand how it works and I would appreciate it if someone could tell me if this is how it worked for 2015. The personal allowance is €5,500, then if you are taxed as a couple there's an additional €3,400, then an additional general allowance of €2,000 and finally if you're over 65 an additional €1,200. So I make that total allowances of €12,100. So for example if income was €18,000 then you would be taxed at 19.5% of €5,900 (difference between income and allowances) = €1,150
I'm not sure if the tax rate should be 19.5% or 24.5% as total income is greater than €12,450, if it's 24.5% then tax would be €1,445 but still less than the €2,000 presented by the Hacienda. Maybe I've got something wrong so please correct me if you know otherwise.
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El Cid
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Re: 2015 resident tax error - allowances calculation?

Postby El Cid » Sat Dec 21, 2019 11:34 am

Your figures look OK to me.Apart from the errors you have identified, I suspect that it is something to do with the married allowance. Hacienda may have calculated his tax without adding the married allowance.

Personally, I would go straight to the tax office to sort it out. They are usually very helpful.

Sid

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fyfin
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Re: 2015 resident tax error - allowances calculation?

Postby fyfin » Sat Dec 21, 2019 11:44 am

Many thanks Sid, probably the best thing to do. He's already paid someone to send of a letter and they haven't spotted anything but I'm going to take another look myself before I go with him to the tax office. My Spanish isn't brilliant but i think it's good enough if I spot something obvious.
A man likes his wife to be just clever enough to appreciate his cleverness, and just stupid enough to admire it


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