What is Fiscal Residency?

Last updated on March 19th, 2020 at 10:10 am.

We’re often asked the question ‘am I a resident in Spain?’ If you live in Spain for more than 183 days (and they need not be consecutive) in any one year then yes, you are. That bit’s simple. But how do you prove it?

Most people would probably answer ‘by applying for the green residencia’. That is the A4 green piece of paper that you obtain from your local police station. What you have there is in fact civil residency but as people move backwards and forwards across countries ‘forgetting’ to cancel these, the Spanish government does not rely on the green paper alone. If you really want to prove you are a resident in Spain you need to have evidence of your fiscal residency.

The Certificate of Fiscal Residency

The certificate of fiscal residency is a white printed-off certificate that is obtained from The Tax Office – Agencia Tributaria. This is what you need to prove residency when you sell your home and avoids you having 3% of the sale price retained. The Fiscal Residency certificate proves residency where there is a Spanish inheritance claim and can make a big difference to the amount of inheritance tax payable. You will not benefit from these tax advantages unless the notary sees your fiscal resident certificate when presiding over the transactions.

In order to obtain your fiscal residency certificate you need a copy of your last Spanish Tax Return – Modelo 100. This is why we recommend all residents make a tax return, even if they fall below the threshold requiring them to pay any tax. It is difficult to obtain a fiscal residency certificate without having presented an annual tax declaration.

Proving income to the authorities has become even more of an issue due to the new co-payment system for prescriptions. Making a resident tax declaration and being a fiscal resident is the best way of ensuring that you are reimbursed when your monthly prescription limit is reached.

Making a tax return

The process is not that difficult. They are completed during June and are retrospective. So in June 2013 you will be completing a declaration for January to December 2012. The last complete tax year. A fiscal representative, like Ábaco, submits many of these every year and will be able to give you advice about the documents you need to take with you for the declaration to be completed.

The appointment at Ábaco usually takes about half an hour and the form is completed online. This means that we can tell people straight away how much there is to pay, if there is a nil return or even if there is overpaid tax to collect.

Not every resident has to complete an annual tax declaration and it is possible to prove fiscal residency without one. However, for a small annual fee, it is a useful way of ensuring that you have the proof you need when you want to demonstrate fiscal residency. In these times of economic uncertainty, it is one way of making sure you really are on the map in Spain.

To help navigate the bureaucracy of the Spanish tax system, our dedicated advisers are on hand to help at every step of the way. Contact us and we will offer you a free consultation without obligation.