Thursday, December 22, 2011

Spanish tax office delivers 300,000 nasty letters

The Spanish tax office began sending out letters headed “comunicacion” to foreign property owners a couple of months ago.  They have been causing a lot of concern to people who don’t understand what they say (they are in Spanish) or do understand but are worried by the implications.

To explain briefly to anyone who hasn’t come across this issue yet, these letters are notifications from Spain’s equivalent of the Revenue (Agencia Tributaria).  In essence they are saying  that they know the recipient owns a property but have not received tax returns from them.  They are not tax demands as such and do not require a response but they do suggest further action will be taken if the property owner receiving the letter really does have tax returns due.

It has been quoted that 300,000 letters have been sent  out.

I won’t go into detail about the matter as there is already some information about them out in the blogosphere and  I have posted a detailed Question and Answer guide on our main website:

I would like to clear up a couple of specific points which I haven’t read about elsewhere –

The letter claims that help will be available at your local branch of the Agencia Tributaria (Google your nearest).  I don’t know how true that will be in practice but it does open up the possibility of being able to resolve the situation without recourse to a professional i.e. paying a lawyer or accountant to catch up your taxes for you. 

If you want to take a DIY approach to the problem, firstly read up on the tax (our website has several articles on non resident tax – see the Advice page and use the drop down box).  The visit the tax office with all your documentation and see what they have to say.

Also you might wonder why the letter is asking for tax returns from 2007-2010.  There is a technical reason for this – the equivalent of a statute of limitations which prevents the tax office collecting unpaid taxes four years after they were due.  For example 2006 resident taxes were due by 30 June 2007 i.e. more than 4 years ago so not collectable. 

They didn’t ask for 2011 returns because they are not yet due.  2011 resident returns are due next June and non resident returns next December.

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