Another tax chore for Spanish property owners

There's an extra chore for over-taxed Brits owning homes in Spain if they want to avoid a run-in with the Spanish tax man. 

British and other non Spanish owners need to prove their non-resident status by producing a new identification document for tax purposes. Failure to produce the document, the "Residencia" or "hacienda" as country Spanish still call it, could lead to mortgage and other payments being stopped.

Britons who use their Spanish bank account to pay the mortgage for their home in Spain have been required by Spanish banks to produce a Residencia certificate since March 2007. CAM Bank has certainly been sending them out, even to Brit customers without a mortgage, but some banks gave homeowners short notice or did not contact them at all.

The Residencia certificate is part of an EU initiative to clamp down on tax evaders. Spanish residents are taxed at source but non-residents can avoid paying tax there only by proving non-resident status. Anyone who does not provide the paperwork risks having their bank account frozen and mortgage payments stopped.

Non-resident status means spending fewer than 180 days per year in Spain and be able to produce the certificate after registerinjg in person at their local Spanish police station or Oficina de Extranjeros and then have the document stamped by a town hall official. If you go specially, try adding the costs of "EU compliance" to your UK expenses and/or your costs of ownership in Spain.

For an EU initiative, some might find it strange that it's not applied in reverse and that other country's are not also using the usual "money laundering, tax evading" excuse for keeping tabs on folks. Free passage throughout Europe, but there are barriers going up for any spare cash its citizens might manage to hang onto - wherever they happen to be living at the time?    

Anyone needing further information can contact the Spanish Ministry of the Interior's immigration directorate helpline on 0034 913 639 071. The document costs between €10 and €13, although going through a lawyer could be more expensive...