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View Full Version : Where can I get the 7% IGIC tax form done for my rental property?



chris
26-04-2013, 17:13
Does anyone know of where I can get one of the forms filled out so that I can pay the 7% Igic tax on my rental property? I had a very expensive quote.

CIM
26-04-2013, 17:30
I would be interested in this too. If anyone can fill out (correctly!) the Modelo 420 each quarter for IGIC at a reasonable price for a few clients, get in touch.

Thanks

Goldenmaniac
26-04-2013, 17:43
The only reason you would need to pay 7% IGIC is on a short term rental (holiday let) Long lets where the property is owned by a private individual and is used as the tenants' home are exempt.
If you are letting on a touristic complex then you are required to do so through a sole agent (huge discussion about this on other thread)
It would be the sole agent, being the business person in Spain who would charge the holiday maker the 7% and fill out the quarterly return and pay that to the government, they then deduct whatever they deduct and give you your profit. If you have a stand alone property which is legal to be let for holiday lets then you will most likely already be in business here or will have a company just dealing with letting or will have a UK company with a Spanish reference number.
Individuals do not collect or pay IGIC into the coffers, only businesses, companies, sole traders etc charge/collect and pay in IGIC.
In order to present a modelo 420 one has to be already registered by way of a modelo 36/37 with the Hacienda - or they are already a company in which case they use a different modelo.

This is the actual text of the explanation of who charges and collects IGIC for the government

Están sujetas al Impuesto, por el concepto de entregas de bienes y prestaciones de servicios, efectuadas por empresarios y profesionales a título oneroso, con carácter habitual u ocasional en el desarrollo de su actividad empresarial o profesional.

The supply of goods and services, made ​​by businessmen and professionals for a consideration (paid), on a regular or occasional basis in the development of their business or professional activity are subject to tax (IGIC)

CIM
26-04-2013, 17:45
The only reason you would need to pay 7% IGIC is on a short term rental (holiday let) Long lets where the property is used as the tenants' home are exempt.
If you are letting on a touristic complex then you are required to do so through a sole agent (huge discussion about this on other thread)
It would be the sole agent, being the business person in Spain who would charge the holiday maker the 7% and fill out the quarterly return and pay that to the government, they then deduct whatever they deduct and give you your profit. If you have a stand alone property which is legal to be let for holiday lets then you will most likely already be in business here or will have a company just dealing with letting or will have a UK company with a Spanish reference number.
Individuals do not collect or pay IGIC into the coffers, only businesses, companies sole traders charge/collect and pay in IGIC.
In order to present a modelo 420 one has to be already registered by way of a modelo 36/37 with the Hacienda - or they are already a company in which case they use a different modelo

I have several clients who have been told by their letting agents on touristic complexes they need to pay for a gestor to submit these. They have been quoted between 264€ and 1080€ per year for this so far....

Goldenmaniac
26-04-2013, 17:55
I would be interested in this too. If anyone can fill out (correctly!) the Modelo 420 each quarter for IGIC at a reasonable price for a few clients, get in touch.

Thanks
See above post CIM - I think it unlikely your clients are registered as businesses or professionals or have I misunderstood what you are asking?

CIM
26-04-2013, 17:56
I´m not sure then but they are being told they need to fill out an IGIC form every quarter. I spoke to Loaded about this earlier and he confirmed it was now the case.

Goldenmaniac
26-04-2013, 17:58
I have several clients who have been told by their letting agents on touristic complexes they need to pay for a gestor to submit these. They have been quoted between 264€ and 1080€ per year for this so far....
Then the sole agent should be questioned!! Or maybe the clients will have to set up as businesses, but that does not seem correct to me (I suspect that is what the 1K quote is for??)
To submit this modelo ordinary gestors charge around 30-50 euros per modelo or it is part of an all in price charged to their business or professional clients.
The iGIC tax law is quite clear that personas fisicas (ordinary individuals) do not charge or collect this tax

CIM
26-04-2013, 18:00
I thought the letting agents would have taken care of it but Chris here has been told otherwise.

Goldenmaniac
26-04-2013, 18:00
To be absolutely sure - I don't pretend to be infallible :) I will call the IGIC help line on Monday and try and get a ruling, but I can't understand how they could possibly register these people to pay IGIC if they are not business people (some are probably non resident anyway??) and you can't just rock up with a modelo 420 - it's the same as the UK you have to be IGIC registered which involves first being registered at the Hacienda

CIM
26-04-2013, 18:03
Ok - well maybe you can get to the bottom of it - I´m interested in knowing how this is supposed to work!

Goldenmaniac
26-04-2013, 18:41
Con fecha 26/04/2013, ha tenido entrada una consulta que nos formula a través del Buzón habilitado al efecto por el Gobierno de Canarias.
En un plazo máximo de dos días hábiles recibirá la contestación a la misma a través de su correo electrónico.
Muchas gracias.


Referencia Consulta: 20722

Su Consulta:
Titulo: IGIC en alquileres de corto plazo
Consulta: Un non residente, propietario de solo 1 apto. en un complejo turístico en Tenerife tiene agente que gestiona los alquileres de corto plazo a los turistas.¿Quien debe cumplir el mod.420 de IGIC el propietario(no es empresarial o profesional) o el agente en el desarrollo de su actividad empresarial?


Should have an answer by Tuesday CIM will post and let you know

Loaded
26-04-2013, 19:09
The owners have to pay igic as they are essentially small businesses now. Previously small businesses did not have to pay igic if they earned under about 30000 per year but that all changed in January.

From here on in owners of holiday rental properties are obliged to pay igic on their earnings.

9PLUS
26-04-2013, 19:33
Better i love collecting IGIC free of charge for the big guns.


Loaded is it the module system they have, meaning 2 choices?

Goldenmaniac
26-04-2013, 20:20
The owners have to pay igic as they are essentially small businesses now. Previously small businesses did not have to pay igic if they earned under about 30000 per year but that all changed in January.

From here on in owners of holiday rental properties are obliged to pay igic on their earnings.

I follow your reasoning if they are resident in Spanish territory but if non fiscally resident



¿Se considera que opera mediante establecimiento permanente en España, una persona no residente que dispone en territorio español de inmuebles arrendados?

No, ya que de acuerdo con la normativa fiscal española, el mero arrendamiento de bienes inmuebles no es uno de los supuestos conceptuados como establecimiento permanente.

The tourist is liable to pay the 7% on the cost of their week's holiday I agree.

If the person has more than one apartment it would be classed as a business, but for one?

Belinda
26-04-2013, 20:21
The owners have to pay igic as they are essentially small businesses now. Previously small businesses did not have to pay igic if they earned under about 30000 per year but that all changed in January.

From here on in owners of holiday rental properties are obliged to pay igic on their earnings.

Do we assume then that residents who rent out a property and who are not yet of pensionable age, are also required to pay social security?

Goldenmaniac
26-04-2013, 20:56
Do we assume then that residents who rent out a property and who are not yet of pensionable age, are also required to pay social security?
Good point! -
Going back to the original question if Loaded is right (which he very well may be) then it won't just be a modelo 420, it will be a modelo 400 at first as well which would be for the initial registration so maybe that's why the quotes are higher.
There is something twanging at my memory also about IMPUESTO SOBRE TRANSMISIONES PATRIMONIALES (which is incompatible with IGIC & IVA) basically the owner would cede the agent the rights to exploit the property for a period of time.
Will report back when/if find out more

Loaded
26-04-2013, 21:20
I follow your reasoning if they are resident in Spanish territory but if non fiscally resident




The tourist is liable to pay the 7% on the cost of their week's holiday I agree.

If the person has more than one apartment it would be classed as a business, but for one?

Think of the owner as a supplier to the sole agent , the owner invoices the sole agent for the use of their property, the sole agent resells the property to the public.... Igic is charged at every stage.

Same as a furniture shop, the furniture shop (top of pile) buys a sofa off an upholsterer and pay him his fee and igic, he then sells the same sofa to the public for a price including (or plus) igic ....

Similarly the upholsterer will have paid invoices with igic from his suppliers for the wood for the sofa or the material for the sofa .

9PLUS
26-04-2013, 21:31
Those Los Cristianos lot never pay any attention to me

Loaded
26-04-2013, 21:33
Better i love collecting IGIC free of charge for the big guns.



Loaded is the module system they have, meaning 2 choices?

????? Que?

Goldenmaniac
26-04-2013, 22:45
Think of the owner as a supplier to the sole agent , the owner invoices the sole agent for the use of their property, the sole agent resells the property to the public.... Igic is charged at every stage.

Same as a furniture shop, the furniture shop (top of pile) buys a sofa off an upholsterer and pay him his fee and igic, he then sells the same sofa to the public for a price including (or plus) igic ....

Similarly the upholsterer will have paid invoices with igic from his suppliers for the wood for the sofa or the material for the sofa .
Yes I perfectly understand the system, but the question is then using your upholsterer example what (cost) price is the owner supplying the week to the sole agent at?

Earlier in the thread you implied the owner would pay IGIC on their earnings, ie cost of week (Before IGIC) less allowable pro-rata expenditure (before IGIC) - Or are you suggesting the agent is acting as a comisionista on behalf of the owner, either on his own account or not? - ie week to tourist 100 euros plus IGIC 7 euros, commission to agent (ie) 10% 10% of 100 = 10 euros - so 90 paid to owner less agents invoice for cleaning/repairs etc etc ----- getting complicated innit? :) suddenly the accountants fees don't see so high :)

9PLUS
26-04-2013, 22:58
Loaded is the module system they have, meaning 2 choices?



Standard payment o accounts

Loaded
27-04-2013, 09:37
Standard payment o accounts

I've heard of this but don't know how it works, explain por favor

Goldenmaniac
27-04-2013, 10:43
Certain empressorial activities - there's a long list but some examples are bars, small builders, hairdressers, as well as accommodation services in hotels and pensions, are allowed to calculate their income tax and their IGIC on a set of tables and percentages which include things like whether you have a vehicle used in the business, or how many tables you have, , the size of the local, how many employees you have, whether there are family members working or not, how many beds the hotel has, these are all given a weight and come together to work out an annual predicted income and quarterly payments. In the case of IGIC the same applies but at year end OR quarterly depending on what you chose you get to deduct the IGIC paid on invoices for items used in carrying on your business .... That's very simplified there are other factors of course but it should give you an idea.
Professionals (very simplistically those offering a service rather than a physical end product) are not allowed to join this scheme

9PLUS
27-04-2013, 11:40
I've heard of this but don't know how it works, explain por favor



Yeah one is a set amount every quarter and calculated at the end of the year.

The other is "contabilidad" were you pay every quarter what you have billed.

Goldenmaniac
29-04-2013, 15:23
Got an answer

Buenas tardes. Al ser alquileres turisticos, deben liquidar igic. En este caso el propietario del piso tendria que haberse dado de alta en el Igic con modelo 400. Y liquidar trimestralmente el modelo 420 del igic y el 210 de impuestos de no residentes. El agente por su lado debe liquidar tambien Igic por su actividad
So groveling in dust in apology yes :) - So basically both the agent and the owners do, the owners have to do the Mod 400 once and the 420 quarterly as well as the 210.
In which case this link may be of interest or of course any Spanish accountant.
http://onlineasesoria.com/