Question
As I understand it, Spanish annual taxes are paid between April and June. However, if you are a US citizen living in Spain, you need to pay your US taxes by April 15. In order to receive a credit for the taxes paid in Spain on your US taxes, you need to pay Spanish taxes before filing in the US. How do others navigate this?
Answers
These are the answers of Spainguru’s Facebook group members:
“You file and pay your estimated US taxes in April, then file and pay your Spanish taxes in June. Then you request a refund from the IRS for the difference.”
“As long as my taxes in Spain are higher than my US liability, I’ll just file a US extension and file when I have the credit. I’m a ‘never pay the government money and then ask for it back’ kinda person.”
“My situation is more complicated because I file jointly in the US with my spouse and singly here in Spain.”
“If you are a tax resident of Spain, then you pay Spanish taxes on worldwide income and use that as a credit on your US tax form. File Spanish taxes first and US taxes second. File a US extension if needed.”
“As a CPA in the US, I caution that an extension is only putting off your filing deadline, not your payment deadline. If you estimate that you will owe US taxes, you should make an estimated tax payment before April 15 to the IRS.”
“If you are a US citizen, you must file taxes wherever you live if your income exceeds minimal thresholds. Various treaties mean you don’t always have to pay.”
“Request an extension on your US taxes and file US taxes after Spain is filed.”
“You are still required to pay. Extensions are only for filing your return, not paying taxes. However, if nothing is due after crediting Spanish taxes, there’s no penalty.”
“Expats always get an automatic two-month extension.”
“Coordinate with your accountant and estimate what you’ll be paying in Spain. Calculate and pay the estimate of what you’ll owe in the US and file for an extension. Once you’ve officially filed in Spain, you can officially file in the US.”
Conclusion
Navigating tax deadlines as a US citizen living in Spain can be challenging due to the differing timelines. While US taxes are due by April 15, Spanish taxes are typically filed between April and June.
Many recommend paying estimated US taxes first or requesting an extension to align the two timelines, as Spanish taxes can be used as a credit on US filings.
Careful coordination with accountants and filing extensions, when necessary, are key strategies to ensure compliance while minimizing hassle.
