Question
I am still remote working for a UK based company and we are in the process of making this permanent. I am worried about tax payment as I understand I’ll have to do this in Spain. I know the UK and Spain have a double taxation agreement, does this mean I can stay on the British PAYE tax system and report this in my “declaración de la renta” here in Spain?
Answers
These are the answers of some Facebook group members:
“If you live in Spain more than 6 month a year you are supposed to pay your taxes here, this means either being employed by a local company either be “autonomo” (self-employed). There are consulting companies that do kind of bridge giving you a local contract and “invoicing” your salary to your mother company.”
“Yup, you will have to go to an accountant to get it done, but yes.”
“Everything will change as soon as you permanently move your fiscal address and medical address right here in Spain. Until then you will keep making the tax return or similar claim in UK. For all the details and small letters contact a good accountant.”
“The easiest we found is to have my salary slip in Spain. It is possible and doesn’t come with a lot of extra costs. In principle you can use the agreement to avoid double taxation, but social security is more problematic. If your company contacts this company https://www.bcnbs.com/contact.html they take care of everything. Good luck!”
“You can also set yourself up as an autonomo and bill your company on a monthly basis. Your company will probably be fine with this, since they won’t be in trouble with the HMRC. The issue with this is you are actually a full-time employee and if the Spanish tax authorities realise, they will demand all the social security tax your company should have paid from you (i.e. you could be left with a bill for thousands of euros). It’s very unlikely they will ever notice or care, and lots use the autonomo route with no issues, but just be aware it does come with its risks and the Employer of Records method is the only proper legal way of doing this.”
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