Dnipro Finance and Taxes

24/ 01/ 2024

At the meeting of the EBA Dnipro Financial & Tax committee together with AC Crowe Ukraine and UCBI discussed the topic of tax residency and taxation in Spain. According to Ukrainian legislation, residents of Ukraine are required to pay taxes on all their incomes received both in Ukraine and abroad. Ukraine and Spain have an Agreement on Avoidance of Double Taxation. This agreement determines in which country you must pay taxes on certain types of income. You can be considered a tax resident of both countries if you stay in Ukraine and Spain for more than 183 days during a calendar year. In Spain, all individuals who receive income and stay in the country for more than 183 days are required to submit an income declaration. The la Renta income declaration campaign usually runs from April to June. What will the tax authorities of Spain do if they consider you their tax resident? The first step in such a case would be a request to explain why the taxpayer did not file a return and pay taxes. At this stage, within 10 days, the following is possible: submit a declaration, pay taxes and fines (5-20%), send a package of documents to the tax office that proves the fact that you are a tax non-resident of Spain. The second step is a deed drawn up in your name and a fine (50-150%). Here are some nuances to consider: The period of stay does not have to be continuous (it does not have to be a certain number of days in a row). The days when you are in Spain for business or tourist purposes are also counted. If you are in Spain for 183 days or more, but your centre of vital interests is in another country, you may not be considered a tax resident of Spain. During the event, we also reviewed the types of visas that third-country nationals can obtain in Spain: Golden visa is granted to investors, entrepreneurs, researchers, teachers and family members. Digital Nomad Visa – for freelancers and online business owners. Startup visa – for entrepreneurs who want to establish a startup in Spain.

What will the tax authorities of Spain do if they consider you their tax resident? The first step in such a case would be a request to explain why the taxpayer did not file a return and pay taxes. At this stage, within 10 days, the following is possible: submit a declaration, pay taxes and fines (5-20%), send a package of documents to the tax office that proves the fact that you are a tax non-resident of Spain. The second step is a deed drawn up in your name and a fine (50-150%). Here are some nuances to consider:

The period of stay does not have to be continuous (it does not have to be a certain number of days in a row).
The days when you are in Spain for business or tourist purposes are also counted.
If you are in Spain for 183 days or more, but your “centre of vital interests” is in another country, you may not be considered a tax resident of Spain.

During the event, we also reviewed the types of visas that third-country nationals can obtain in Spain:

Golden visa is granted to investors, entrepreneurs, researchers, teachers and family members.
Digital Nomad Visa – for freelancers and online business owners.
Startup visa – for entrepreneurs who want to establish a startup in Spain.