Necessary Documentation for Tax Return and changes

This article summarises the necessary documentation for the Tax Return 2023 to be filed in 2024. The tax campaign has already been launched by the Tax Agency with some significant changes:

• Taxpayers with more than one payer and incomes below €15,875 will be exempt from filing income tax.
• If you have purchased a new electric vehicle (car or motorcycle), you can deduct up to 15% if you have paid at least 25% of the purchase value (the installation of a charging point in a privately owned home for electric vehicles also allows a 15% deduction).
• Those performing services for foreign companies will be exempt from taxation with an annual maximum limit of €60,100. The deduction can only be made if the territory where the services are performed applies a tax similar to income tax and is not considered a tax haven.
• Cryptocurrency investors whose overseas income exceeds €50,000 will need to file form 721.
• For self-employed workers:
  • The minimum income threshold of €1,000, which previously exempted them from filing a Tax Return, has been removed. All self-employed workers are required to file a Tax Return regardless of their income.
  • If taxed under simplified direct assessment, you can add €2,000 per year for hard-to-justify expenses and apply 7% (previously 5%).
  • Up to €4,250 can be deducted from self-employed pension plans. If you add an individual pension plan (which allows a deduction up to €1,500 per year), the deduction increases to €5,750 annually.
• Limits from which the taxpayer must file the income tax:
  • Income from a single payer: only file if they exceed €22,000 annually. In the case of multiple payers, it is mandatory if the sum of work income does not exceed €15,000.
  • Income from a single payer: must declare if their income is more than €22,000 annually.
  • Income from two or more payers: must declare if their income is more than €14,000 annually.
  • All persons who have received the Minimum Income (IMV) must file the Tax Return.

Downloading data from the Tax Agency

To download tax data from AEAT, you need:

• Reference from box 505 of the previous year’s Tax Return, or if you did not file, the bank account.
• A copy of your Spanish ID or NIE.

Personal situation relevant for the tax return

Detail if there has been any change in your family situation during the year to be declared. For example:

• Births or deaths. If you have started living with ancestors or descendants.
• Certificates of life, retirement, illness insurance or rescues that have occurred during the last year.
• Separation or divorce agreements, compensatory pensions you have paid.
• Certificate of disability or impairment for any member of the family unit.
• Documents accrediting any works you may have carried out to adapt your home.
• Receipts of payment or daycare certificates for children under 3 years old (age in the year for which the tax is being filed).

Salaries and benefits

• If you are employed, your employers during the last year must provide you with the withholding certificate on wages.
• If you are retired, unemployed, or affected by an ERTE, the benefit and withholding certificate provided by Social Security.
• If you are self-employed:
  • Books of income and expenses from the previous year.
  • Advance payments of business activity (Models 130-131).
  • Model 036 or 037 of activity registration and certificate of professional withholdings from companies you have invoiced.

Bank accounts

Bank certificate from all the entities you work with (usually listed in the tax data but important to check that none are missing) both Spanish and foreign.

Do you have a housing account? If so, you will need the certificate of the contributions made during the past year.

Properties

Main residence

Here the documentation varies depending on different cases

• If you have purchased and/or built your main residence during the year to be declared: deeds of sale, notary fees, property registration as well as payments to the real estate company and amounts paid on the contract of deposit.
• If you have a mortgage signed before 2013: amortization schedule that you can download from your bank.
• If you live in a rental and can apply the corresponding deduction (if you don’t know, don’t worry, we’ll review it): rental contract, cadastral reference, ID of the owner, and receipts for rent payments.

Second homes and other properties

• Receipts for the Property Tax (IBI) of all your properties.
• Rented properties: if you have a property management company that manages the rentals, they should provide you with a settlement with the income and expenses. If you manage it directly, you must compile the income receipts and invoices for improvement expenses and investments.

Donations

Donation certificate if you have made any donations to non-profit organisations or NGOs.

Buying and Selling, Transfers

• If you have sold a property: deeds of onerous transfer of properties or by lucrative transfer.
• If you have sold shares or cryptocurrencies: sales information of shares and/or cryptocurrencies.
• In the case of cryptocurrencies, we need a squared fiscal report from a platform like Koinly, Atani, or Cointracker.

Investments

Certificate of listed securities, investment funds, and other financial assets.

Detail of investments to acquire shares or social participations in the constitution or capital increase of commercial companies and expanding businesses of the Alternative Stock Market.

Certificate about contributions made to pension plans (remember the new deductible limits).

Wealth Tax

You are generally required to file the Wealth Tax Return if you are in any of these situations:

1. Your tax liability, after applying deductions or reliefs as applicable, results in a payment due.
2. The value of all your assets and rights exceeds €2,000,000 regardless of the outcome of the tax liability.

It is important to note that the exemption threshold for this tax varies depending on the autonomous community, for example, it is €500,000 in Catalonia.

That is, below €500,000 you are exempt. Between €500,000 and €2,000,000 you only need to present it if it results in a payment due and above €2 million you must always file the return.

We recommend our article When are you obliged to submit the Wealth Tax Declaration for 2022?

Beckham Law – Income Tax for Expatriates (model 151)

The Beckham Law stipulates that instead of filing the normal income tax return, expatriates who can take advantage of this special regime will file a special income tax applying the tax for non-residents instead of the income tax.

This means that a resident in Spain (the displaced worker) is taxed as if they were not a resident, applying a fixed rate of 24% instead of the variable scales of the income tax.

You can join this regime before coming to Spain or within 6 months from the moment you register with the Social Security as a worker of a Spanish company. If you need support to declare your incomes according to the special tax regime, popularly known as the Beckham Law, it is necessary that you send us the following information:

• Copy of Spanish NIE.
• Withholding certificates for wages and salaries from your employer(s).
• Certificates about your bank accounts.
• Model 149 filed. If you don’t have it, we will need to file it to verify that you can take advantage of this special tax regime.

For the submission of model 149

If you already have it, send us a copy of Model 149, otherwise we need you to send us the following documentation:

• Copy of the ID from your country of origin.
• Date of entry into Spain.
• Employment contract and a letter from the company detailing the contact information and location of the company, personal details of the employee, position and duties.

Tax Return as an Airbnb host

If you are an Airbnb host, you must declare these incomes differently depending on whether you offer hospitality services or not.

If you do not offer them, the returns from your Airbnb must be declared in the tax return.

The calculation of these returns will be made by subtracting the tax-deductible expenses from the total income obtained on Airbnb. Keep in mind that you can only include those corresponding to the time the property has been rented.

Avoid mistakes by applying deductions and deductible expenses by hiring a tax expert specialising in taxation for Airbnb guests.

Do not hesitate, we can help you, hire your tax return from our website and forget about everything.

For information on related topics, visit our page on Tax and Wealth Declarations.

Cryptocurrencies

The taxation and obligations for cryptocurrency operators have changed this year, which is why we collaborate with CryptoVeritas, experts in the area.

Photo by Kelly Sikkema on Unsplash