When an individual becomes tax resident in Spain?

The concept of Residency, it is a concept that many times can take to confusion, even more if we go into the Tax Residency.

How we can find out when an individual is Tax Resident?

The first step will be going to the Double Taxation Convention undersigned between Spain and their Country. In order to answer this question we are going to use as an example the Double Taxation Convention undersigned between Spain and the United Kingdom1.

In the article 4.1, we find the following:

Article 4. RESIDENT

1. For the purposes of this Convention, the term “resident of a Contracting State” means any person who, under the laws of that State, is liable to tax therein by reason of his domicile, residence, place of management, place of registration, or any other criterion of a similar nature, and also includes that State and any political subdivision or local authority thereof.

This is the Double Tax Convention, which sends us to the Laws of the Country of Residence to determinate about the same.

Here in Spain we will have to go to the Income Tax Law LIRPF 35/20062, and specifically into the article 9, which says:


1. It will be understood that an individual has his habitual residece in Spain when any of the following circumstances:

a) That he stay over 183 days during the natural year in Spain. In order to dterminate this period of permanence in Spain, it will account for the sporadic absences, unless the individual accredit his Tax residence in any other Counttry. In the event of Counties considered as Tax Heavens the Adminsitration could demand the evidence about the real permanence in the Country for 183 days in the natural year.

In order to determinate the period of stay in the above paragraph, will not account for the temporary stays as consequence of obligations arising from agreements of cultural of humanitary colaborations, free of charge with the Spanish public administrations.

b) That he has in Spain directly or indirectly the base of his activities or economic interest.

It will be understood, unless proven otherwise, the individual has his habitual residence in Spain, when according the previous criterias, his spouse and the children younger than 18 of age which depend on him have their habitual residence in Spain.

According to this information, we have to understand it is not possible to choose where to pay your taxes, this is very well defined by Law, and nowadays the exchange of information between the tax administrations from the different Countries is very frequent and normally, they can find out where we are residents.

1) Spain-UK Double Taxation Convention

2) Income Tax Law LIRPF 35/2006

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