Income Tax Return Experts in Spain
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income tax returns Specialists
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The income tax return is an annual tax liability in Spain due each year between April and June. It can provide you with a refund of your taxes paid in Spain.
It can be a real headache, since it is in a language that you may not speak or understand, not to mention the unfamiliar laws.
If you do not have the advice of an English-speaking specialist to do the work for you, you may end up filling out the tax form incorrectly and paying more.
What is the income tax return in Spain?
Once a year between April and June, you must submit your income tax return for the previous natural year, based on your worldwide- income, rental income, interest, dividends and capital gains received throughout the year.
The percentage of taxes withheld from your income and the deductible expenses make up the total amount of the income tax return.
In addition, some specific details such as whether you are married, whether you have children or a disability must be taken into account.
The compendium of all the above will give you an estimate of how much tax you must pay annually and, if you have paid them religiously throughout the year, the income tax return will be correct (you do not pay extra).
In the best-case scenario, you will receive a tax refund (the State refunds part of the taxes paid).
Who should file a Tax return?
Not everyone should file a tax return in Spain. However, we do recommend doing so if you are an Expat or have a Spanish visa, as it will be a proof of residency.
In most cases, employees who earn more than €22,000 gross per year will be liable to file and submit a tax return. This is only applicable if the €22,000 comes from a single payer-employer. This means that you only have one specific contract and all your income comes from that specific activity.
If you have more than one payer, the annual income is reduced to €12,643 in order to be obliged to file a tax return. This is the case when you have several contracts at the same time. Unemployment benefits received count as money paid from a contract.
This does not mean that you do not have to file a tax return if one of these cases applies to you, it just means that you are not obliged to do so. As a general rule, those to whom one of the aforementioned cases applies will have an advantage when filing their income tax return, as the State will most likely refund part of their taxes paid during the year (if any).
On the other hand, if you have paid less taxes that year than what you should have, then you pay the difference to the State in your tax return.
English-speaking accountants to help you file your Income tax returns.
We have accountants who are specialised in filing income tax returns for Expats living in Spain.
When is the income tax return due in Spain?
You can start filling your income tax return in April of the current year. Specifically, the tax return campaign usually starts on 7th April.
You can file your tax return from 7th April until 30th June, but we recommend that you do it as soon as possible to avoid unexpected surprises.
During these three months you can file your tax return, although it is always a good idea to prepare all the necessary documents beforehand in order to mitigate the expense and reduce the amount you have to pay in taxes (or increase the refund).
Although the tax return campaign takes place during these months, you must bear in mind that it is an annual process, therefore, it is necessary to have an accountant who knows how to balance all your accounts month by month. As a result, you will not have the extra cost in the months of the income tax return and your accounts will be in order from the outset.
Income tax returns submitted in the current year contains all your income, interests, dividends, capital gains, … generated during the previous calendar year or previous natural year. In other words, if you want to file the 2020 tax return, it will cover the period from 1st January 2020 to 31st December 2020 (all your income and taxes) and will be filed in April – June 2021.
What is an accountant or tax advisor’s role when filing your income tax return?
As accountants and tax advisors, we advise clients and make sure they worry
as little as possible about their tax affairs. Having a professional specialised
in accountancy and tax returns for Expats in Spain will ensure peace of mind at
all times, as you will not have to worry about anything and, in addition, you
will save a lot of money.
As mentioned before, the tax return is only due once a year. However, it is
important to keep your accounts in order every month. In fact, in Spain, there
are quarterly VAT returns, which will be reflected in the tax return you end up
filing. If you do not keep it up to date, you may even incur in fines from the State.
Do not hesitate to call us and ask us everything you need, as we have
specialists in Expats who will provide you with all the personalised information
you need for your case. What’s more, the first consultation is free and we
respond as soon as you call us, with no waiting or delays.