Time to complete the annual tax return in Spain

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Annual tax return Spain

The period for completion of the Spanish annual tax return – ‘la declaración de la renta’ – is from April 7th to June 30th.  This year, many people may find the process more complicated due to receiving ERTE payments during part of 2020.   

Generally, anyone who lives or stays in Spain for over 182 days a year is considered a tax resident. Therefore, they must fill out the annual income tax form. The Spanish tax year runs for a calendar year with tax returns filed the following year.  

Limits for the ‘renta’

Anyone resident in Spain who earned €22,000 and over in 2020 must file an income tax return.

All tax payers whose annual income is less than €22,000 will be exempt from filing a tax return. This only appplies if your income comes from a single source.

If your income comes from more than one client or job however – such as teachers working for different language schools, businesses or autónomos (self-employed) – you need to complete the return regardless of the level of your earnings.

Unemployment benefits considered income

During 2020, 3.5 million people received ERTE from the State Public Employment Office (SEPE). ERTE is not subject to tax at source; therefore it is taxable in the 2021 campaign.  

In addition, if in 2020 you were in an ERTE position, working reduced hours for a company whilst receiving part of your salary through ERTE payments, the tax authorities see you as having two sources of income. Therefore, you need to complete a tax return.

In an ERTE suspension of employment situation, you will only have 1 payer: SEPE.

Two or more sources of income

The rules state that a taxpayer who has two or more sources of income, must submit their Income Tax Return if their income from work exceeds €14,000, and the amount paid by the second payer (and successive) exceeds €1,500.

This means that anyone who received an income during 2020 from their usual employer before being placed on ERTE, will need to complete a tax return. The Gestha union of Hacienda employees explained that those who earned €14,000 to €22,000 in 2020 need to fill in a declaration if they received more than €1,500 from SEPE in 2020.

If you have only had one payer, you must submit your Income Tax statement in 2021 if your income from work exceeded € 22,000 in 2020.

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Exemptions from filing tax return

There is also an exemption from filing if you only received a very small amount of income, i.e. less than €1,500 taxed at source.

This exemption is meant to apply to income that has already been taxed. So, if you have an untaxed foreign employment income it is still advisable to file a Spanish tax return.

What are the key filing dates?

The end date for submission of tax returns is June 30th. However, if you want to present your declaration by phone or in person you should be aware of other key dates.

April 7th: Online presentations open

May 4th: From this date you can request an appointment to be attended on the telephone

May 6th: You can submit your tax return by phone from here on

May 27th: The deadline to request to submission in person

June 2nd: You can submit your tax return in person

June 25th: If you wish to pay by direct debit, you must submit by this date

June 30th: The end of the tax campaign window.

If you are in any doubt, you should contact a tax lawyer or gestor who will advise you.

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