View Full Version : Tax and the 6 month rule.

02-09-2011, 11:27
I am a UK ex pat thinking of buying a property in Tenerife - but worried about the 6 months tax rule.
Assuming I do not work there, and just visit for holidays - how hot are the authorities on this rule?
Do I have to count days and keep records.
Do they check passports and keep a tally for every visit?

02-09-2011, 12:07
It's not set in stone ... and no one is keeping a record at the airport :)

If you end up with more interests here than just a holiday property, and plan regularly spending more than 6 months a year, then you should take advice from an accountant used to dealing with matters like this.

The concept of "centre of economic interests" will be applied to someone who has income earned in two jurisdictions, and where fiscal residence should be based.

Should you move to Tenerife and declare Spain as where you want to pay your taxes, then you will have to keep records of dates spent in the UK to keep out of the clutches of HM Revenue & Customs :)

02-09-2011, 14:28
If you are going to gain income from your holiday home you will be taxed on it even as a Non Resident without a permanent establishment, and since Jan 2011 you will be required to prove your Fiscal Non resident Status in Spain by way of a Certificate of Fiscal Residency which is obtainable from the UK Revenue and Customs (ie you can prove you are registered to pay your general income taxes in the UK)

If you do not let out for gain you will still be liable for deemed income tax.

Either way any doubt would be proved by the certificate of fiscal residence in the UK OR a simple P60 if you have that available every year.

As Doreen said. that would be different if you earned income here (and possibly in the UK as well) which was the result of a "permanent establishment" or by dint of physically being here working.

Tax is a complicated subject but have a look here for some general info. http://www.diana-mcglone.com/Non-Resident-Home-Owners-and-Annual-Property-Taxes.htm#Nonrestaxspain

The main criteria will be what you earn (including pensions and dividends) and where it comes from, the days spent in Spanish Territory are a rule of thumb guide applicable for MOST circumstances.

IF you own here but do not let out for gain, visit for holidays and do not obtain any other income, have a Non residents bank account and can provide proof of Fiscal residence in the UK you are unlikely to fall foul of the 183 day rule -
HOWEVER what you may be playing with is your right to UK health care because under UK rules if you remain outside of the UK for longer than 90 days at a time you may be considered to have given up your entitlement to health care and benefits there - have a look on the direct.gov.uk website or the UK consulate website ukinspain for more on that. (there are moves to change that regulation for Pensioners in the offing by the way)
Plus by staying for longer than 90 days in Spanish territory you are obliged to get a certificate of residence (green NIE) from the Extranjeria here.

So in a nutshell - come twice a year for holidays, earn no income in Spain except deemed income on the property, for a maximum of 90 days each time and you won't upset either country!