The Non-Resident Income Tax in Spain (IRNR) is a tax on income obtained in Spanish territory by individuals or legal entities that are not resident in Spain.

When is a taxpayer in Spain considered a Non-Resident?

The parameters that define a taxpayer in Spain as a Non-Resident are:

• you are not considered to be resident in Spanish territory,
• that there is certain income that is considered to have been obtained in Spanish territory,
• whether or not there is a permanent establishment in Spain, and
• the existence or not of a double taxation avoidance agreement between Spain and the State of residence of the non-resident citizen in Spain.

It is worth bearing in mind that from 1 January 2021, the provisions that apply to residents of other EU Member States no longer apply to residents of the United Kingdom, but that there is a Double Taxation Agreement between Spain and the United Kingdom that remains in force after Brexit.

The Non-Resident’s Income Tax applies to any non-resident citizen in Spain who obtains certain income in any geographical area of Spain, as stipulated in the spanish Non-Resident Income Tax Law, leaving aside the foral regimes in Spain, and the particularities of this tax that apply to Ceuta and Melilla, as well as the Balearic Islands.

The key aspects of spanish Non-Resident Income Tax, in order to determine whether an income obtained by a non-resident citizen in Spain is taxable under this tax, are as follows:

• • a property, movable or immovable, situated in Spanish territory, certain income derived from such property will be taxed in Spain. This criterion applies to the different types of income, capital gains and rights obtained through such assets, even indirectly. It is interesting to know that even securities located in Spain, which are considered movable assets, will be taxed under this tax.
  • dividends and capital gains on securities issued by individuals or entities resident in Spain, regardless of the place of issue, are taxed under this Non-Resident Income Tax,
  • economic activities obtained in Spain, even without a permanent establishment, of professional services, studies, technical assistance, management and management support, etc., and even work performed in Spain or partially using Spain, will be considered as obtained in Spain and will be taxed under this tax.

If you need to declare your taxes as a non-resident in Spain, at Pérez Parras Economists and Lawyers we are experts in international tax law. Contact us so that we can help you, give you a quote and make your declaration of assets abroad correctly, avoiding the penalties that come with not filing your taxes in Spain, or filing them incorrectly. Our professional team, with offices in the centre of Malaga town centre and in Nerja, is comprised of lawyers with double degrees in Law and Economics, bilingual and experts in national and international taxation, for residents and non-residents. We are also experts in the declaration of assets and rights abroad (Spanish Form 720), and others.