# Income Tax for UK Web Designers in España



## Leao (Jun 23, 2013)

Hi, I'm looking for some unambiguous advice about income tax in Spain.

I'm an English freelance web designer currently residing about half my time in London and the other half in Spain, but I would love to live in Spain full-time with my girlfriend who is also English. My clients are exclusively British and I expect this to continue to be the case even if I were to reside permanently in Spain. I earn about €50,000 pa. We hope to have children (eventually) and we would ideally like to have full access to Spanish schooling and healthcare.

My issue with Spanish taxation is not only that it's high compared to the UK but it also seems ridiculously complicated. I would rather pay to the British authorities for as long as legally possible. Many of my Spanish friends seem to take paying tax with a pinch of salt but I would not be able to sleep at night if I had to worry about the Guardia knocking on my door (after they finish with Leo Messi).

I am currently registered in the UK as a freelancer but am open to changing my status (e.g. to a limited company) if that would save me money and make life simpler. We both have Spanish NIE numbers.

I imagine this question opens up a whole can of worms, for example if you are a Spanish registered company do you charge your UK clients IVA?

_Does anyone have any recommendations regarding law firms who specialize in this issue?
_
Many, many thanks for your time


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## XTreme (May 17, 2008)

I'm doing the same as you and I'm fully registered here....always have been.

It's true that the system isn't favourable for us compared to the UK in terms of costs etc.....but it is what it is. Still better than living in Britain that's for sure.

You will find a lot of gestors are not clued up on international business so you'll need to look around a bit to find the right one. Mine is in the city of Granada, and he's excellent, but you'll need to speak Spanish to deal with him.

As for IVA/VAT.....you charge it to all EU businesses that _don't_ have a relevant tax number, and to all Spanish businesses and individuals.


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## Stravinsky (Aug 12, 2007)

Leao said:


> Hi, I'm looking for some unambiguous advice about income tax in Spain.
> 
> I'm an English freelance web designer currently residing about half my time in London and the other half in Spain, but I would love to live in Spain full-time with my girlfriend who is also English. My clients are exclusively British and I expect this to continue to be the case even if I were to reside permanently in Spain. I earn about €50,000 pa. We hope to have children (eventually) and we would ideally like to have full access to Spanish schooling and healthcare.
> 
> ...


I have lived in Spain full time since 2006. I'm the director of a small Limited internet based company (not web design) which sole business is in the UK. As said, it's registered in the UK as Ltd, and there is a UK director also, but just for administration purposes.

I did not need to register as autonomo in Spain, it wasn't legally necessary. None of my business was conducted in Spain, nor money received in Spain.

What I _did_ need to do though was declare all the income I received from the company for tax in Spain as an individual. Annual tax returns. Corporation tax of course was paid in the UK. Under the new rules of course, if you have assets in the UK in different bands exceeding €50k, then you have to declare those assets, and that would include the valuation of your company or any property you owned there. However, you would have to do that if you were a Spanish citizen also.


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## Stravinsky (Aug 12, 2007)

I should add that being a Ltd company does sometimes increase your costs. You need an accountant if you want to do it hassle free. I used an accountant year before last, but this last year I collated all the figures myself, registered with HMRC for on line filing, and did my own accounts. An accountant was costing us £800 a year, then the annual return costs £24ish on top of that.


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## Leao (Jun 23, 2013)

Thanks for you replies.

Although I do speak some Spanish, there must be specialist English speaking law firms in Spain that deal with this kind of thing all the time? A Spanish based law firm familiar with the UK tax code would be better positioned to guide clients, such as myself, through their options without any ambiguity. Should I start a new forum post, specifically asking this question?

Stravinsky - Your post gives me some glimmers of hope that I can possibly legally avoid the rigmarole of the Spanish tax code. Don't you have to register as autonomo with regards to the money you receive as an individual? I would like to have access to Spanish healthcare and schooling eventually. Do you have access to these services under your current tax status? Like you, all my clients are UK based. In the future I may have foreign clients but more likely American as opposed to Spanish or even EU.

XTreme - Thanks also for your message. Can I have the number for your Greanda based lawyer?

Cheers


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## xabiaxica (Jun 23, 2009)

Leao said:


> Thanks for you replies.
> 
> Although I do speak some Spanish, there must be specialist English speaking law firms in Spain that deal with this kind of thing all the time? A Spanish based law firm familiar with the UK tax code would be better positioned to guide clients, such as myself, through their options without any ambiguity. Should I start a new forum post, specifically asking this question?
> 
> ...


accessing schooling is nothing to do with tax - you just need to register as resident for that

accessing healthcare is another matter - although in various circumstances you can do so by way of a reciprocal agreement with the UK, for a limited time - give the DWP a ring & have a chat with them


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## NickZ (Jun 26, 2009)

If you're working in Spain your Spanish.

I've no idea if Spain uses the control test but the UK courts invented it. So unless things have changed a corporation controlled from Spain would be Spanish under the control rule. The rule is over 100 years old.


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## xabiaxica (Jun 23, 2009)

NickZ said:


> *If you're working in Spain your Spanish.*
> 
> I've no idea if Spain uses the control test but the UK courts invented it. So unless things have changed a corporation controlled from Spain would be Spanish under the control rule. The rule is over 100 years old.


I know you don't mean that......

you mean 'subject to Spanish regulations'............ yes?


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## Stravinsky (Aug 12, 2007)

Leao said:


> Stravinsky - Your post gives me some glimmers of hope that I can possibly legally avoid the rigmarole of the Spanish tax code. Don't you have to register as autonomo with regards to the money you receive as an individual? I would like to have access to Spanish healthcare and schooling eventually. Do you have access to these services under your current tax status? Like you, all my clients are UK based. In the future I may have foreign clients but more likely American as opposed to Spanish or even EU.


In Spain I have to declare my worldwide income for tax purposes. Therefore as an employee of a company in the UK (Yes, directors ARE employees) and earn an income and live in Spain full time, I have to declare it for tax here on my individual tax return. It may well be that you incur some tax in the UK if you are not "zero rated" for income tax there, but under the double taxation treaty you wont be taxed twice. In theory any tax you pay in the UK can be deducted from the tax return in Spain, and the excess paid here (Spains tax is higher than the UK in some circumstances)

I have access to health, but thats because my wife is over retirement age, and I am a dependent. You would probably have to go for private health doing the above, but private health here with people like Seguro de salud - Seguros - Seguro dental - Seguros médicos - Seguro médico online - Residencias - médicos - hospitales is remarkably cheap compared to the UK. We started at €1150 a year for two in their mid fifties
Schooling ... wee Xabiachicas comments



NickZ said:


> If you're working in Spain your Spanish.
> 
> I've no idea if Spain uses the control test but the UK courts invented it. So unless things have changed a corporation controlled from Spain would be Spanish under the control rule. The rule is over 100 years old.


If its a UK Limited company, he is an employee of a UK company even if he is living in Spain


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## nikkisizer (Aug 20, 2011)

Hello Leao,

The UK residence rules for tax purposes have changed with effect from the current tax year (2013/14) so it may well be worth your while to have a look over those too beforehand.


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## Hombre62 (Jun 13, 2013)

You need expert advice. A basic fact sheet (PDF) from KPMG here may be of some help.


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