# Tax on income



## casa cristeva (Mar 17, 2009)

Hi 

Please forgive me if this is repeated but times change...

I have a police pension which is taxed in the UK due to other benefits.

Nothing is earned in Spain, yet I am told by a friend that works for Inland revenue that we still have to pay tax in Spain?

I have a Spanish mortgage and money is transferred each month to pay for it.

So all income is still in the UK and I receive my normal P60 each April.

What if anything do we have to pay here?

I have been told we have to pay tax TWICE, but we have no income here from working as we are both retired........

So what is right and what is wrong at this moment in time PLEASE?

Steve


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## Xose (Dec 10, 2008)

casa cristeva said:


> Hi
> 
> .........
> I have been told we have to pay tax TWICE, but we have no income here from working as we are both retired........
> ...


You most definetely DO NOT have to pay Tax twice.

You need to establish your residency position. Keep in mind that greater than 186 days in Spain means you should be a registered resident.

You need to check with the DWP if the Police pension is one of the few that is taxed at source and NOT in the country of residence in the EU.

All other income is another matter!!

As you might have some income taxable in the UK (the Police Pension) and some in Spain (all else earnt from inside and outside Spain) do speak to the DWP and a Spanish Assesor/Gestor to get the proper legal position. The good news is that you won't pay twice. The bad news is that if you don't get both sides knowing what your position is, you might end up paying twice and having to claim one back etc., etc., to comply with the double taxation treaty. You really don't want that hassle!

Hope this helps.


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## casa cristeva (Mar 17, 2009)

*Thank you*

We are residents, all done and dusted in that department.

My disability is not taxable and everything is in the UK as I say, DWP and all know we are here and have our correct address etc etc etc.

After a 2 year fight we managed to get our Care part of DLA re-instated under the EU directive, but not the mobility side, the EU told DWP it had to be done as well but........ 

Steve




Xose said:


> You most definetely DO NOT have to pay Tax twice.
> 
> You need to establish your residency position. Keep in mind that greater than 186 days in Spain means you should be a registered resident.
> 
> ...


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## Xose (Dec 10, 2008)

casa cristeva said:


> We are residents, all done and dusted in that department.
> 
> My disability is not taxable and everything is in the UK as I say, DWP and all know we are here and have our correct address etc etc etc.
> 
> ...


I'm sorry I can't be more definitive. You really do need to talk with someone on the Spanish side. I think an English speaking gestor might be the answer.

Unlike things like child support, dissability is trasportable to another EU country I believe. But I also believe that the Seguridad Social pay it and claim it back from the UK. Thus, it would have to be "arranged" here.

The reason why I replied in my first post is because I have a particular issue myself this year with a policy maturity which is tax free in the UK, but not in Spain. As I live in Spain, I will have to pay some tax on it. Unfortunately, the Spanish recently changed the taxation of policies that are not re-invested into pension plans and I will get no reduction for the number of years I've been paying it (26). 18% (reduced amount at least) on all of the profit element. 

A friend of mine recently had to decide to take the whole amount as pension from a UK company pension payment, or have the lump sum element. Standard stuff in the UK. He soon found out after talking with his Gestor that if he took the lump sum, although not taxable in the UK, it would be taxable here as an earnings amount for the relevent year. He decided to take it all as monthly pension and pay the tax in smaller chunks.

Basically, if you want to be totally legit, take what you earn and where you earn it from, to a gestor or assesor that speaks English. Let him give you the official line and then decide whether to make a tax return or not armed with the facts.
By seeing one of these guys, you're not actually commiting to anything, you're just getting the offcial version.

In my opinion though, one thing's for sure, don't take answers from any forum as the definitive article.


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