# Dual Citizen/Resident (EU & USA) – Tax Implications & Options



## robertfw (Oct 21, 2013)

Hello! Any advice/help on my situation explained below would be greatly appreciated!

Background: I am both a USA citizen and EU citizen with dual passports and residency. I left the USA 1.5 years ago and am currently living in Spain. I have my own self proprietor owned business in the USA (and make income from USA based clients) so I’ve always paid US taxes while living abroad. I’ve made about 15K from my USA based business so far this year and none yet in the EU.

Question: I have been offered a 3 month full time contract position in Spain which could lead to full time employment (from a Danish company with an office in Barcelona) and am trying to figure out A) whether to bill the Danish company through my USA company (and pay USA taxes) or B) register for my NIE and pay taxes here in Spain. 

Solution: I am leaning towards option A because I already have my business setup there so it seems like a lot of less of a hassle. I also have to wait for 1 month just to get an appointment to get my NIE. 

Originally, I preferred to report and pay the taxes in Spain in order to reduce my overall tax liability (since most countries don’t take your first 10-15K euros) but I heard that I would have to pay around 260 euros (in addition to regular income taxes) just in social security fees (autonomo?) which seems ridiculously high since I don’t plan to live in Spain for more than a couple of years and already have benefits like health care (from Hungary where I am resident with a security card). 

Has anyone been in a similar situation? Any advice?

I’m looking for solutions that A) are simple and B) reduce my overall tax liability.

Thanks!
Rob


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## 213979 (Apr 11, 2013)

Wait, you are living and working in Spain and you aren't registered as autonomo or declaring the US income? 

I wouldn't ask here for advice, I would find a good gestor with international experience FAST. 

I may stand corrected but my understanding is that it doesn't matter where your clients are from, you must register as self-employed. 

I would talk to a gestor first, especially since it sounds like you have been working illegally for a while.


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## robertfw (Oct 21, 2013)

Elenetxu - No, you didn't read my email clearly. I haven't started to work in Spain yet (but expect so in the future and thats why I'm pro-actively trying to get information on the subject). I've always paid my USA taxes even while living abroad.


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## NickZ (Jun 26, 2009)

You missed Elenetxu point. You're living in Spain.


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## snikpoh (Nov 19, 2007)

Hi Rob, I think you are a little confused.

You say you are resident in Spain (and also in USA and Hungary) - how is this possible? I assume that you mean you LIVE in Spain - residency means something slightly different here.

If you have been living in Spain for 18 months then, according to the law, you should already have your NIE and have signed on the list of foreigners ('residencia') using the appropriate visa - this should have been done within the first 90 days of arriving!

After 182 days (6 months) you are automatically deemed resident for tax purposes. As such, you are required to complete a tax return each year and pay any taxes (IN SPAIN). You might still have to pay taxes in USA but you will get a 'credit' for these on your Spanish tax return.


I think the advice you've been given is correct - get a gestor to sort out your situation and FAST before you are fined.


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## xabiaxica (Jun 23, 2009)

snikpoh said:


> Hi Rob, I think you are a little confused.
> 
> You say you are resident in Spain (and also in USA and Hungary) - how is this possible? I assume that you mean you LIVE in Spain - residency means something slightly different here.
> 
> ...



well he doesn't have to worry about a visa, since he has EU citizenship...... but yes, absolutely, if he's been here that long he should by now have registered as resident & submitted his first tax return - although to be fair it isn't clear that he has been here that long


for more specific 'International' tax advice, it might be worth asking here Expat Tax - Expat Forum For People Moving Overseas And Living Abroad


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## robertfw (Oct 21, 2013)

First of all, I arrived to Spain only 1 week ago (and already have an NIE appointment scheduled to drop off my papers.

Secondly, "residency" in my case needs to be loosely interpreted. Its more like I've been living on the road for 18 months (in over 12 different countries in the world). My point in using the word was to emphasize I am an EU citizen (that can legally reside in the EU and not am not here "illegally as an American).

Thanks,
Rob


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## snikpoh (Nov 19, 2007)

robertfw said:


> First of all, I arrived to Spain only 1 week ago (and already have an NIE appointment scheduled to drop off my papers.
> 
> Secondly, "residency" in my case needs to be loosely interpreted. Its more like I've been living on the road for 18 months (in over 12 different countries in the world). My point in using the word was to emphasize I am an EU citizen (that can legally reside in the EU and not am not here "illegally as an American).
> 
> ...


OK, yep, I got it wrong when you said that you left USA 18 months ago and are now in Spain - my mistake.

I would go directly for 'residencia' which will give you an NIE at the same time.


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## 213979 (Apr 11, 2013)

Robert, I'm sorry. Given the fact that you said "Question: I have been offered a 3 month full time contract position in Spain which could lead to full time employment (from a Danish company with an office in Barcelona) and _am trying to figure out A) whether to bill the Danish company through my USA company (and pay USA taxes) or B) register for my NIE and pay taxes here in Spain. _" I thought you had been living here for a while and you had not yet registered for your NIE (especially since you also made the statement that you were going to have to wait a month to get your NIE.)

All that being said it is my understanding that if you are in the country for x-amount of time and/or earn x-amount of money, you should register first as a resident and then as self-employed. While you are an EU citizen, you also do need to register if you are going to be in the country more than x-number of days (EU citizens can better inform you.) What I would be wary about is working here and not declaring it. Hacienda and Seguridad Social are looking for a buck under rocks at this point. Don't be their target!


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