Spain residency without tax residency?

[JustAnotherNomad]

I have seen some digital nomads advocate for Spain as a "paper residency" as you aren't automatically considered tax resident, even if you rent a place for the whole year.
So you can get utility bills to show to banks etc. - just make sure you don't spent too much time there and you can prove this if asked. It's basically just your vacation home.

But how much time can you actually spend in Spain with such a setup?
What kind of documentation would they want to see to accept you're not tax resident under Spanish law (which would be much better than hoping for a DTA to save you)?

I guess you would need some other residency (ideally tax residency) to explain to the Spanish tax authority that that's where you really live?
Which is a bit pointless if you really just want a paper residency, with the option to spend some time there when it suits you...

 

[Roo]

I think that is pretty much crap, it may work on a EU passport since you rent a place and declare nothing nowhere but your rent payments will be visible to the hacienda (unless you pay cash) and if they come after you it may be a long and painful thing to prove you're not a resident there. I guess having no other ties and showing you didn't stay in the country via plane tickets, rentals in other countries may help.

Do note renting in Spain needs more paperwork than you can imagine due to problems with squatters, basically you can stop paying rent tomorrow and they can take forever to legally kick you out especially if you have kids or elderly living there (awful socialist laws...) so as a nomad with no work in Spain and no one to guarantee for you (locals which may know the realtors, etc) you need a lot of luck to rent something other than vacation rental.

You may however be able to do that in Malta, a few years ago one ID and cash for 2 months rent => rental contract without issues.

 

[JustAnotherNomad]

I meant being there officially, with the hacienda accepting that you are only resident, not tax resident.

Spain considers you tax resident if you spend 183+ days in the country or if it's your main base or center of activities or economic interests.
Economic interests should be simple if you have a company with some substance elsewhere and no Spanish clients.
But center of activities or "main base" could be tricky. If you spend only 1 week per year there, I guess it should be fine. But what if you spend 1 month there? 3 months? 4 months?

I'm not talking about flying under the radar, just trying to understand the rules to decide if it could make sense to have a base there.
I would by far prefer Spain over Malta.

 

[toums]

You may however be able to do that in Malta, a few years ago one ID and cash for 2 months rent => rental contract without issues.

Exactly. Still the same. Same in Portugal too and central Europe too.

I'm not talking about flying under the radar, just trying to understand the rules to decide if it could make sense to have a base there.
I would by far prefer Spain over Malta.

Most probably (as for France), if you spend less than 183 days there AND you have no local wife no kids there AND you dont have any business in Spain (or it doesn't represent the main of your income/investments) AND you have another base abroad (yearly rental or own a flat).. Then probably NO problem.

If you miss 1 of these 4 criterias, then you increase the potential problems..

 

[Roo]

If you don't mind bad weather, the Czech Republic was the same and probably still is, you need an ID and cash, you can rent directly from the owner (beware of scams). I don't think they will look into you much, I know of quite a few people who didn't declare income there, worked in an office and invoiced from a different country for their salary, had multiple companies which were just paper companies to have levels of income below X so their taxes are lower, etc.

I didn't like Malta, Spain is much better. Romania is also an option to get a rental address easily, no proper document checks or anything there, have the money rent the place. There may be a slight reluctance to rent to foreigners but under and EU passport it should be ok. If you want an EU address for banks and stuff it can be good.

Really depends what you want from that 'main base'. The 183+ days is a generic EU thing but they can be creative if they have a reason to pick on you.
Honestly in Spain if you don't have a NIE I doubt anyone will look into you, without that (which is a tax id for foreigners) it's hard to do anything there, even purchases of over a certain amount of money require a NIE and bank transfer payment. It is kind of the document that proves residency or that you registered for it and then there is a separate one empadronamiento which proves you live at an address. Lots of bureaucracy.

 

[JustAnotherNomad]

Sorry, just to be clear: I am not asking for suggestions for other paper residencies.
I am asking only about Spain - because I could imagine actually spending some time in Spain (but I'm not interested in spending time in Romania, Czechia, etc.).
But my question is: How much time can I officially spend there, before it could become an issue?
Not looking for ideas how to avoid detection by the hacienda or whatever. I would simply like to understand the official rules.

Most probably (as for France), [...] Then probably NO problem.

Sorry, but no two countries are the same, there is no "as for country X".
Also, "probably" doesn't help. Please only reply if you have knowledge about Spain.

 

[Xshore]

They will not consider you tax resident just because you rent or own a place there. A lot of foreigners have properties in Spain and you don't (automatically) get in the system unless you register as a resident.

I think the official rules for how long you can stay is not 100% clear, as they say that temporary trips outside of Spain still counts towards the 183 days limit. I think I read about a court case confirming that if you're away for 180 days (or something like that) then that shouldn't be considered temporary absence. Their rules also says that you're a spanish tax resident if your main economic base is in Spain, so if you have a home and funds in Spain then I assume it's a risk that they could consider you tax resident.

 

[JustAnotherNomad]

They will not consider you tax resident just because you rent or own a place there. A lot of foreigners have properties in Spain and you don't (automatically) get in the system unless you register as a resident.

Correct, that's why I asked.

I think [...]. I think [...] I assume [...].

Please only reply if you have knowledge about Spain.

 

[Martin Everson]

But how much time can you actually spend in Spain with such a setup?

Ok

Spain considers you tax resident if you spend 183+ days in the country or if it's your main base or center of activities or economic interests.

You answered your own question.

What kind of documentation would they want to see to accept you're not tax resident under Spanish law (which would be much better than hoping for a DTA to save you)?

I would keep i.e a rental contract from property outside Spain, bank statements showing expenses such as phone, internet and shopping in the country you claim to be living. I would also keep travel records showing arrival in Spain and exit from Spain. If your driving into Spain consider flying in instead to keep records.

So you can get utility bills to show to banks etc. - just make sure you don't spent too much time there and you can prove this if asked.

I wouldn't personally do this. This is just drawing the Spanish tax authorities attention to yourself. Unless your poor and not wealthy you could be opening up the gates to an investigation. Are we talking foreign banks here? Where are you then going to tell banks your "tax resident" if they even allow you to self certify your tax residency? If you allow then to report to Spain, which most will do anyway, you may get a headache not worth having.

P.S I would personally NEVER consider Spain.

 

[JackAlabama]

I have seen some digital nomads advocate for Spain as a "paper residency" as you aren't automatically considered tax resident, even if you rent a place for the whole year.

Ive seen a lot, but which geniuses advertise for this?

 

[requser]

Sure, you can be a legal resident in Spain and a tax resident elsewhere. You can potentially spend the majority of the year in Spain, even. It is possible, yes, but it is not easy. Definitely not recommended.

Assuming that you plan to spend the majority of the year in Spain, the country where you want to be tax resident must be one whose domestic law considers you tax resident for reasons other than time spent there (center of vital interest, investments, family ties, etc). In other words, you need to deliberately become tax resident of the two countries according to their domestic laws: Spain by time spent, and the other country by something else. Now, since both countries are claiming you as tax resident, the tax treaty will determine which country wins. No tax treaty? Forget it, pick another country for tax residency. So, read the tax treaty and make 100% sure that the other country wins the claim on your tax residency. That's pretty much it. In theory.

The problem is that, compared to most other countries, Spain is very aggressive when pursuing their claim. They will demand a lot of proof, and you may be forced to challenge whatever they decide by additional legal means. You may be able to do it, but you will waste a lot of time, money and energy instead of living your life. If you have kids attending school in the other country, and you pay social security there, and you have family relatives there, and maybe a company with employees there, and a car registered there, then stuff like that could count as center of vital interests and maybe Spain will leave you alone.

Frankly, it's better to just pick another country for both your legal and tax residency. If you pick one in the Schengen area, you can visit Spain all you want as a tourist.

What is it about Spain, really? Don't feed the monster!

 

[JustAnotherNomad]

Now, since both countries are claiming you as tax resident, the tax treaty will determine which country wins.

No, I was talking about a case where one wouldn't be considered tax resident in Spain under domestic Spanish law.
If you have a vacation home in Spain and only spend 10 days per year there, this should be a clear case, even under Spanish law.
But if you spend 3 months there, maybe not so much? I'd like to know if anyone has some experience with this, so tax treaties never become relevant.

There are many such countries in Europe, for example, Lithuania and Estonia are the same - but where do they draw the line?
I would expect Spain to me more aggressive about this, but still OK if you can show you spend only very little time in Spain and don't do business in Spain. But where do they draw the line?
Even if not formalized in the law, there would usually be some case law, such as "60 days per calendar year are fine", etc.

 

[Benzouser]

If you don't mind bad weather, the Czech Republic was the same and probably still is, you need an ID and cash, you can rent directly from the owner (beware of scams). I don't think they will look into you much, I know of quite a few people who didn't declare income there, worked in an office and invoiced from a different country for their salary, had multiple companies which were just paper companies to have levels of income below X so their taxes are lower, etc.

I didn't like Malta, Spain is much better. Romania is also an option to get a rental address easily, no proper document checks or anything there, have the money rent the place. There may be a slight reluctance to rent to foreigners but under and EU passport it should be ok. If you want an EU address for banks and stuff it can be good.

Really depends what you want from that 'main base'. The 183+ days is a generic EU thing but they can be creative if they have a reason to pick on you.
Honestly in Spain if you don't have a NIE I doubt anyone will look into you, without that (which is a tax id for foreigners) it's hard to do anything there, even purchases of over a certain amount of money require a NIE and bank transfer payment. It is kind of the document that proves residency or that you registered for it and then there is a separate one empadronamiento which proves you live at an address. Lots of bureaucracy.

"Romania is also an option to get a rental address easily, no proper document checks or anything there," . . . can you confirm a bit more about that , .i know if u do the 90d resident registration there u will get a tax ID . . unsure if u need to pay any taxes if stay less then 183d.

 

[Roo]

"Romania is also an option to get a rental address easily, no proper document checks or anything there," . . . can you confirm a bit more about that , .i know if u do the 90d resident registration there u will get a tax ID . . unsure if u need to pay any taxes if stay less then 183d.

I'm only talking about having an EU passport and showing up and renting a place, no idea about registering, I am aware the ANAF is desperate to milk money from anyone they can but not very competent. If you do need to register, I know the rules say you should but loads of people don't do between countries inside the EU unless they need paperwork for some specific reason. Owner or real estate agents there are very happy to take your money and rent you a place, you can probably even pay cash month to month, often owners skip registering rentals for skipping tax unless the tenant needs it to be done (like company pays his rent and needs proper legal documents). The bureaucracy there is bad and keeps changing every few years.

 

[BerlusconiSchmidt]

You guys overthink and panic over these things all the times. If you rent a small place in Spain and you don't share Lambos and Rarris on Instagram in Barcelona on a daily basis, no one is every going to bother you. Seriously, do you think if you rent a 2 bed in Malaga and live 10 months a year in Checoslovakia they'll ever Tax you in Spain? This isn't a Mafia movie. They barely can Tax their own citizens.

As long as you don't have any assets in Spain, you can show them you pay Taxes elsewhere, and they can take it in the butt.

 

[JustAnotherNomad]

That wasn't my question. I'd just like to understand the rules.

 

[JackAlabama]

That wasn't my question. I'd just like to understand the rules.

why dont you ask the genius who talks about that on youtube? He will tell you the reasoning.

 

[scooterguy]

That wasn't my question. I'd just like to understand the rules.

It's usually not a problem if you spend less than 6 months a year there, and I say 'usually' because there are two rules for Spanish residency. They are:

• Stay in Spain for more than 183 days during the calendar year. To determine this period of stay, your sporadic absences are counted, unless you prove your tax residence in another country. In the case of countries or territories classified as tax havens(1), the Tax Administration may require proof of permanence in said tax haven for 183 days in the calendar year.
  To determine the period of permanence, temporary stays in Spain that are a consequence of the obligations contracted in cultural or humanitarian collaboration agreements, free of charge, with the Spanish public administrations, will not be counted.
• That the main nucleus or base of its activities or economic interests is located in Spain, directly or indirectly.

Source: Tax Agency: Individual resident in Spain

Now, the first rule is very easy to follow, just spend less than 183 days there, but just be careful with doing something such as being there from January to March, and then from September to November, because they will count the absence as temporary and then you might need to prove residency somewhere else.

I said 'might', because this is obviously random; they are not checking every single person. But if they do target you after making that mistake of forgetting the sporadic absence thing, you'll have to prove tax residency somewhere else.

The second rule is somewhat vague, and it will depend a lot on your particular circumstances, whether you have assets in Spain or some sort of economic interest, among other things.

If you start opening bank accounts using your residency there, it might get tricky, depending on volume. If you keep renting in Spain for years, continue opening bank accounts with it, Spain will get CRS information and no one knows how they'll eventually handle it.

If you are making big money they might knock on your door one day and ask you what's going on and why do you have all these accounts tied to your Spanish address, to the place you've been renting for the last X years? Now, those are exactly the questions you don't want Hacienda to ask you.

I'd personally just spend my summers there in an Airbnb and don't get too fancy with Spain... Plenty of better places to get 'paper residency'.

 

[requser]

Even if not formalized in the law, there would usually be some case law, such as "60 days per calendar year are fine", etc.

If you don't have wife and kids in Spain and don't have center of vital interest in Spain, then as long as you stay in Spain less than 183 days, you are fine according the law. If you are worrying about spending 90 days or so in Spain alone, probably just don't worry. Of course, avoid doing silly things such as having a bank account in Spain, or having a car registered in Spain, or using a Spanish phone number as your main contact number, etc. In other words, act as a long-term tourist, not as a short-term resident.

 

[Cloudbanck]

So assume you have access to a property that isn t in your name, say owned by an elderly relative that doesnt use it or something. So you dont have to rent anything, and you have no assets in the country, and no local bank account, and your income comes from a company abroad. I wonder how long you could live in Spain or similar countries (Italy, France) like this before the tax authorities notice anything?

I guess you'd still use debit/credit cards in the country, and that non-tourism use could show up in some tax authority filter. But if one uses cash not coming from an ATM in the country, a foreign company card, or a card without a name if that's possible, or mentor group tricks.

And of course if you are very flashy and visible on social media, authorities may pick up on that.