- This topic has 25 replies, 10 voices, and was last updated 14 years, 5 months ago by
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The Wealth Tax has been abolished, but the revaluation of properties in Tenerife (and I believe elsewhere) has meant that we are paying almost the same amount of tax we were before (based on imputed income).
Apart from an acknowledgement I have still heard nothing from Brussels about my complaint of unfairness. -
I have now heard from Brussels. They consider that there is nothing unfair in the imputed income tax on non-residents on the basis that it also applies to residents who own more than one property. They have however decided that there is unfairness in the inability of non-residents to deduct expenses on actual income.
I have replied to them asking them to reconsider on the basis that the imputed income tax is in fact a wealth tax on non-residents, even though the wealth tax as such has purportedly been abolished. It also assumes that one owns a residence elsewhere when this is not necessarily the case. -
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I believe the authorities are starting to catch up on non-payers (together with appropriate penalties). In any event all amounts (together with appropriate penalties) will be deducted by the authorities on sale or other disposal.
It has always been the obligation of the owner to obtain the appropriate forms (you used to have to pay for them – you can now get them on line from AEAT.es) and submit his return.
The amount is based on the Valor Catastral (rateable value). Until last year there was also a wealth tax to pay assessed on a similar basis. -
Failed! Brussels considers that there is no discrimination between European citizens despite the points that I made. However, if we are eventually allowed to deduct expenses against any income, then it would appear that even those of us who do not let our properties will still have enough expenses (water, rates, electricity, maintenance etc) to set off against the tax completely.
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Arthur,
I admire your determination to get a level playing field. Lets hope that some progress will be made.
One point though with regard to residents also having to pay income tax on a deemed rental income for a second property. Does anyone know a Spanish resident that has ever paid this tax, or the tax authorities asking for payment on sale?
Given that it’s customary to under-declare everything in Spain, I would find it absolutely incredulous for a Spanish resident to pay income tax on income that they never receive on a second property that they simply use for personal use.
So lets have a poll. Does anyone know a resident Spanish or otherwise that has paid income tax for non-existent income?
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@Arthur wrote:
I have just heard from Brussels that a draft law to give non-residents a level playing field with residents on the deduction of expenses against deemed rental income, is presently before the Spanish Parliament and could be in force by the end of the year!
Well, maybe you have been granted your wish for a level playing field, tho not quite as you envisaged.
http://www.telegraph.co.uk/property/propertynews/6424829/Second-home-owners-face-stealth-tax-in-Pre-Budget-Report.html
(Just thought I’d pop in to see if things had improved…I see they haven’t 😉 ) -
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Arthur wrote:“135yearsinwaiting”
If you are not interested in what I have to say kindly desist from making snide comments (and learn to read).[/quote]
I was not doubting what YOU wrote, I quite understood that you meant 2009, what I was alluding to is which year the Spanish government were referring to. No “snide” remark was intended but after many years in Spain I treat ALL
statements by the Spanish government with a pinch of salt especially when they refer to changing the law in favour of the people or returning money to them.I wish you every success in your crusade.
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@lizh wrote:
Well done Arthur. It would be great to deduct expenses. Does anyone know how the base liquidable is calculated on an IBI demand and what it’s there for? I can only find it in relation to inheritance tax…
Hello,
Re your question regarding “Base Liquidable”
I have used the IBI terminology in order to try not to complicate matters more than they are. Note that IBI may use abbreviations for most terms!Base Liquidable is intended to damp down the impact of the (often drastic) increase of the “Valor Catastral” and spread – incrementally (0,1%/year) – its full implementation over 10 years, by applying a different “K” factor each year in the calculation. See below.
Base Liquidable is used in the calculation of the tax amount to be paid (“Importe a ingresar”). This “Importe a Ingresar” is arrived at by:
1) multiplying the “Base Liquidable” by the Tax Rate (“Tipo de Gravamen”), which gives the Cuota Integra/Cuota liquida participada.
2) deducting any discount (“decuento” ) listed on the IBI.The BASE LIQUIDABLE is arrived at by:
1) Multiplying the 2009 “Valor Catastral” by a “coefficiente de actualización” (2009 = 0,0/none; 2010 = 1,02 – etc);
2) deducting the 2008 Valor Catastral from the 2009 Valor Catastral;
3) multiplying the result of 2) by the factor “K” (0,9 for 2009; 0,8 for 2010 and so on);
4) deducting the result of 3) from the result of 1) to arrive at the value for the “Base Liquidable”.You will have noticed that your Tax Rate is NOT applied to your 2009 Valor Catastral but to the (lower) Base Liquidable to arrive at the Tax Due Amount (Importe a Ingresar) on your IBI.
I didn’t invent it and I hope it will help.
Sorry for my English; it is not my mother language.Xavier/Belgium
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The Base Liquidable only has relevance to the payment of the IBI (“local authority rates”).
In calculating the deemed income tax for the Modelo 210, the Valor Catastral has to be used. I have checked this with AEAT in Madrid.
With the revaluations, for many of us the result is that we are now paying as much for the deemed income tax as we were formerly paying for that plus the wealth tax! -
Deductible charges & reduction – Income tax – Non-resident.
The advance notice given by Arthur has apparently materialize.
The Instructions for filling-out Form 215 mention, under #2 Liquidaciòn, that : (free translation!):
“As of 1 January 2010 and in order to arrive at the taxable base, the charges covered by Ley 35/2006 can be deducted………..”I found Article 23 in the 77-page law 35/2006 covering “Gastos deducibles y reducciones”.
My basic Spanish and limited experience with tax matters bring me to ask for assistance:
QUESTION: Could someone be more specific/explicit in listing/itemizing the (main) allowable deductible charges?
I have here in mind for example items such as the monthly fee for the maintenance of the complex, the charges for a new railing around the community pool to meet new legislation, water, electricity, trash, etc?
Are such charges now deductible?Any assistance would be appreciated. Thank you. Xavier/Belgium
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