The General Directorate of Taxes has presented a query in which it communicates that it will collect taxes from non-residents who have exceeded a stay of 183 days in the country, regardless of whether their stay has been conditioned by the state of Covid-19 alarm.

Who are you referring to?

• Travelers trapped by confinement.
• Foreigners with a second residence in Spain where they spend part of the year.
• Spaniards residing abroad who are in the country teleworking or in a family home.

According to the laws on personal income tax and on taxes for non-residents, the taxpayer will be considered to have their tax residence if they meet one of the following factors:

• Stay of 183 days or more in the calendar year in Spain.
• Computing sporadic absences.
• That the activities and economic interests are in Spain, directly or indirectly.

There is a risk that the criterion may be extended to other areas, such as the tax residence of legal persons, as their effective management is altered by the confinement.

It also involves risk of permanent establishment if a foreign worker had to stay in Spain carrying out activities that could give rise to a prolonged period.

The measure adopted by the Spanish Administration is contrary to the call of the OECD, which has asked the EU member states not to take into account periods of force majeure such as Covid-19 in the face of tax treatment, but Spain does not want adopt the measure as done in the United Kingdom, Australia, Ireland or the United States.

This information does not constitute under any circumstances legal advice, serving only for informational purposes. In case you need professional services in Global Immigration and Mobility, please contact us.

* It should be taken into account that the regulations of any of the countries analyzed, as well as the established procedures, may change at any time and without prior notice.

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