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View Full Version : Other We cam on holiday and now we're staying. We have some questions!



crimy
27-01-2015, 02:39
Well, how to make a long story even longer. My girlfriend and I along with our adorable little kitten made our way over from Ireland to the Canary Islands in October of last year. We drove all the way down here and our initial plan was it to stay here for the winter months until April. We own an Irish/American based business and can work from anywhere as long as we have internet, so no need to be tied to Ireland. We really enjoy our time over here and decided to not go back to Ireland in April and instead stay in the Canaries for the next two years. Now, many questions are coming up and it seems like we're a little bit lost since we don't speak Spanish other than the basics to get through the day shopping and ordering in restaurants. Hopefully some people here on the forum can help us.
1. Our car: We came with our car, a Toyota Prius. We are now facing two options. Say bye bye to our nice car, or register it with Spanish plates. As far as I know we're still good to drive it until April as we don't have to change the plates until we're here for more than six months. But, what do you guys think? Is it worth it to register a €6000 car to Spanish plates? How much will that cost us? And can we do that knowing that we only speak little Spanish? We don't really rely on a car here as much as we did in Ireland as we work from home and we live very central with everything around the corner. Additionally the bus system is by far better than in Ireland and renting a car every now and then is probably cheaper than owning a car anyways, but still putting it on Spanish plates is an option we're looking at as we've had the car for almost a year now and we kind of grew on it.
The second option would be to sell it. Now the question is if there is a market for cars on foreign plates with the wheel on the wrong side. I read about people going back to the UK buying cars on UK plates, but how many Irish people are down here going back to Ireland looking for an Irish reg. car? If there is a market for it, where should we look?

2. Residency & Tax: When we got here we obtained a NIE to open a bank account, but it was a temporary NIE for three months and has expired since then. We didn't bother following up on it as we thought about going back anyways. We probably need to go and ask for the temporary NIE again which will be good for three months before we can get the real one with the residency, right? How do we go about taxes? Our company is based in the US and Ireland and therefore pay US and Irish corp. taxes. We still have an address in Ireland and go there every now and then for business purposes. Are we fine filing for personal tax in Ireland rather than here and not taking the Spanish residency? As I wrote earlier, we're not planning on staying here very long term (max. two years). If we do have to get the Spanish residency and pay Spanish personal taxes, do we have to pay the social security charges? We are both on private health insurance and we don't need access to the public system of Spain.
I think this is all I got for now, but I'm sure after reading some of your responses I'll have probably two questions for each answer I'm reading, so get ready for a loooong threat on the forum (hopefully).
Thanks,
Chris

Tony the Welder
27-01-2015, 03:24
If you live in Tenerife (anywhere in Spain) for more than 183 days per year you have to pay Spanish taxes on any income derived in the world. The rate is 24.75 per cent for the first €0 - €17,007 going up to a massive 52 per cent after personal allowances These rates will change for 2015 - €0-12,450 will be 20 per cent up to 47 per cent for those earning over 60,000 euros. In England you can claim the tax back paid, I am sorry I do not know about Ireland. But there is a double taxation agreement in place, so you need to contact the Irish 'Inland Revenue'.

amanda
27-01-2015, 08:35
Why not drive the car back to Ireland, sell the vehicle there wouldthat not be an easier solution,

martincrabb99
27-01-2015, 11:03
Get a valuation in Tenerife and Ireland, work out the costs of registering the car in Tenerife and you can then make an informed decision. There are plenty of people on this forum with good knowledge relating to the process of registering a car in Tenerife.

doreen
27-01-2015, 12:49
If you live in Tenerife (anywhere in Spain) for more than 183 days per year you have to pay Spanish taxes on any income derived in the world. The rate is 24.75 per cent for the first €0 - €17,007 going up to a massive 52 per cent after personal allowances These rates will change for 2015 - €0-12,450 will be 20 per cent up to 47 per cent for those earning over 60,000 euros. In England you can claim the tax back paid, I am sorry I do not know about Ireland. But there is a double taxation agreement in place, so you need to contact the Irish 'Inland Revenue'.

That's the general rule, but there are exceptions. It depends on where your "economic centre of interests" is based. Irish corporation tax is much lower than in Spain (there is the exception of the special zone ZEC in Tenerife which is only 4% but probably not worth investigating if only staying for 2 years).

If you own any property in Ireland and none in Spain, then you would certainly be able to continue paying taxes as you do in Ireland and the US. If you don't own any property, it is not so clear, but I would think you are better to aim to keep the status quo.

Legally you are obliged to register at the Town Hall of the municipality of where you live in Tenerife once you are on the island more than 3 months, so you should do that now. Currently, this does not link you in any way to the tax system in Spain.


Regarding your car, there is a great post somewhere by DJDangerous giving all the links to how to register your car ... the person he recommends, Jesus, would be able to give you a quote on changing over your car to Spanish plates.

EDIT - here's the post I was referring to - Jesus speaks good English

http://www.tenerifeforum.org/tenerife-forum/showthread.php?36738-How-to-find-out-the-cost-of-importing-a-car-to-Tenerife

DJ Dangerous
28-01-2015, 11:28
Hi Crimy.

Your car will have a greatly reduced sale value here as the steering wheel is on the wrong side.
I imagine that very few people are ambidextrous drivers.
Personally, I swap from an LHD to an RHD every single day and I don't notice any difference, and I certainly see no benefits in driving an LHD, apart from McDonald's McAuto and car-park ticket machines.
However, I'm probably in the minority, and so you face a very small market to sell your car to.

Buying a similar car here will probably cost a lot more than the €6k it is worth in Ireland.
The used-car market here is closed-off from the outside world due to distance and taxes, so prices are over-inflated. I often drive by the bus stop in Los Cristianos and see a chatarra for €2500, and think to myself that you'd buy the same car for €500 back in Ireland.
A 2010 Prius costs €13500 (http://www.tenercoche.com/coche/33170) here in the south of the island -the photo of this one was taken in San Eugenio Alto.

I have used Jesus Gonzalez de Chavez Parache on several occasions, and apart form being fluent in English, and not looking for money up front, he is cheaper than any southern-based gestors and is flawlessly reliable.
He holds an unofficial "office" session in that American-themed restaurant in CC Gran Sur every Friday at lunch-time.

Jesus will provide you with a free quote. His contact details are:

Jesús González de Chaves Parache
C/ Mendez Nuñez 38
38002 Santa Cruz de Tenerife
Titulados Mercantiles y Empresariales,
Colegiado nº 808
Telf: 922-152-072
Fax. 922-248-466
Mob: 670-702-994
Email: jegonchapa(AT)gmail(DOT)com

crimy
03-02-2015, 01:15
Wow, thanks for all the nice advice. Helps a lot already. Seems like we will have to consult with an accountant and see what's best. A lawyer said, we don't have to deal with all that until this summer as the new year set all back to zero, so technically speaking, the car and we have only been here one month this year and no need do anything at this stage. We will sure give Jesus a call as it seems the best choice will be to keep the car to avoid losing money. It's a no (or low) emission car so tax and all shouldn't be too high anyways.

doreen
03-02-2015, 20:31
Wow, thanks for all the nice advice. Helps a lot already. Seems like we will have to consult with an accountant and see what's best. A lawyer said, we don't have to deal with all that until this summer as the new year set all back to zero, so technically speaking, the car and we have only been here one month this year and no need do anything at this stage. We will sure give Jesus a call as it seems the best choice will be to keep the car to avoid losing money. It's a no (or low) emission car so tax and all shouldn't be too high anyways.


I'm not so sure all that advice is correct ... yes, the tax year starts at Jan 1st and you do not fall into the system for 2014, so in fact, you would not be doing a tax return until June 2016 (for the year 2015) if paying tax as an individual wage earner ... however, if you plan running a business here and paying tax in Spain, you have to send in reports (modulos) every three months. The paperwork in Spain is quite a headache compared to what you might be used to.

And, as I understand it, you only have six months re the car regardless of the date you arrive on the island, and you should be registering with the Town Hall after 3 months here unless perhaps you flew home at Christmas and so that clock would reset.

Some good news .... car tax is low here no matter what kind of car you drive :)