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 Non Residents Tax Payment 2016
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john1022
Teeing Off

United Kingdom
64 Posts

Posted - 23/11/2016 :  21:50:00  Show Profile  Reply with Quote
Just received my 2015 NRTax assessment to be paid by 31/12/16 and it has increased by over 40% year on year
I'm concerned about this as my circumstances haven't changed in the last 12 months and I was wondering if anyone on the forum as had similar increases or can shed a light on this?

Corcaigh
Approaching The Pin

14 Posts

Posted - 29/11/2016 :  11:27:52  Show Profile  Reply with Quote
John
This is an explanation I've seen on another forum: The short explanation is that the Spanish government have increased this tax. The long answer is more complex. The tax liability is based on ?assumed? income calculated from the cadastral value. How this is calculated changed in 2015. Prior to 2015, the assumed income was 1.1% of the cadastral value (provided values in your municipal area had been reviewed since 1994). In 2015, the ?goalposts? were moved. Now, in municipal areas such as yours where cadastral values have not been reassessed since before 2005, the assumed income is 2% of the cadastral value. As a result, there is a significant increase in the tax bill.
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davarn
Playing Off Scratch

United Kingdom
1727 Posts

Posted - 03/12/2016 :  12:27:47  Show Profile  Send davarn an ICQ Message  Click to see davarn's MSN Messenger address  Send davarn a Yahoo! Message  Reply with Quote
I queried this rather large increase with my abogado. Here's the response:

>> For the tax year 2015 there are two important changes -

A) MODIFIED TAX RATE:

From 1st January 2015, the applicable tax rate to EU, Iceland and Norway tax payers is 19.50%, while for all other tax payers it is 24%. In principle, you should note the saving in this year?s tax bill (please remember that non-resident income tax is paid in arrears ? the Spanish fiscal year matches the calendar year 1st January-31st December).

From 1st January 2016, the corresponding tax rate will be even lower, at 19%, applicable to your tax bill payable in 2017. For all other, worldwide tax payers, the rate remains at 24%.

B) MODIFIED TAX CALCULATION:

Unfortunately, despite the reduction in rate, your tax bill will not reduce. It will in fact rise. This is due to a modification in taxable base value. The concept is very difficult to explain fully in a general newsletter, but the following points will hopefully provide an introductory overview:

- Non-Resident income tax is based on the Cadastral Value of your property, multiplied by a coefficient. This determines the taxable base to which we apply the Non-Resident income tax rate of 19.50% or 24%.

- In order to calculate the future tax base, the coefficient increases from the previous 1.1% to 2% for properties located in those municipalities that had not carried out any reassessment of cadastral values within the last 10 years. This includes the majority of town halls. Town Halls reassess periodically the value of properties in their jurisdiction.

Please, do not be confused by the increase applied to cadastral value each year due to index revisions made by Spanish Central Government, in response to Budget Law. <<

Got it? ;-) )))

Dave, 2nd floor ap't with best view on La Torre
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LTJoe
Hole In One

Ireland
880 Posts

Posted - 04/12/2016 :  12:27:05  Show Profile  Reply with Quote
So the Town Hall doesn't bother to carry out a review and as a result we pay more. Only in Spain!
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davarn
Playing Off Scratch

United Kingdom
1727 Posts

Posted - 04/12/2016 :  13:21:09  Show Profile  Send davarn an ICQ Message  Click to see davarn's MSN Messenger address  Send davarn a Yahoo! Message  Reply with Quote
Yes Joe, but denuncias are confetti down there ;-)
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LTJoe
Hole In One

Ireland
880 Posts

Posted - 04/12/2016 :  18:46:04  Show Profile  Reply with Quote
Now now Dave! Be careful, because you might be investigated by the UK constabulary for having an opinion, or worse still, for asking a question!!

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john1022
Teeing Off

United Kingdom
64 Posts

Posted - 08/12/2016 :  20:29:54  Show Profile  Reply with Quote
quote:
Originally posted by john1022

Just received my 2015 NRTax assessment to be paid by 31/12/16 and it has increased by over 40% year on year
I'm concerned about this as my circumstances haven't changed in the last 12 months and I was wondering if anyone on the forum as had similar increases or can shed a light on this?

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john1022
Teeing Off

United Kingdom
64 Posts

Posted - 08/12/2016 :  20:37:58  Show Profile  Reply with Quote
Thank you davarn and corcaigh for your comprehensive explanations
Yet again it seems to be shut up and put up
Thanks once more
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