Income Tax
Company Tax
Rates And Allowances
Property Related Tax
UK-Spain Double Tax Treaty

Local Tax Offices

Back To Home Page

Residence

Can only be tax resident in one country.

A person is resident in Spain if:

Spends more than 183 days in a calendar year in Spain or
Activities or economic interests are based in Spain.


Taxation of income and gains

Rental income

May be taxed in country where property is situated.
Election to Inland Revenue to receive gross available.

Capital gains on disposal of property

May be taxed in country where property is situated.
Possible exemption available for sale of UK property by non-UK resident.

Business profits

Taxed in country where company is based.
If permanent establishment in other country, taxed in that country as well.

Dividend income

Taxed in country where shareholder is resident.
Provisions for withholding tax.

Interest income

Taxed in country where beneficiary is resident.
Provisions for withholding tax.

Pension income

Taxable in country of residence.
Election to Inland Revenue to receive gross available.

Exception:

Taxpayer was a civil servant. in which case the income is taxed in the country of original employment.


Double tax relief

UK Resident with Spanish income

Tax credit for lower of:

  Tax suffered in Spain
  Equivalent UK tax

Underlying tax relief is available for dividends received when there is at least 10% shareholding in the Spanish company.


Spanish resident with UK Income

Tax credit for lower of:

  Tax suffered in UK
  Equivalent Spanish tax

A Spanish resident company with UK dividends receives the same tax credit as it would have if dividends had been received from another Spanish company.

These notes are intended as a guideline and should not be used as a substitute for proper professional advice. Please contact us and we will be happy to assist you.