2018 Spanish Personal income tax filings: key issues

As in every year around this time, the Spanish Personal income tax (“Renta”) filing season started on the 2nd of April and it shall end on July 1st. For those tax returns with an amount payable by direct bank debit, the deadline is June 26.

As a novelty this year in relation to the tax return filing, the possibility of printing the tax return and related documents, generated through the Spanish Renta Tax Office service, disappears.

Instead, the tax return will have to be filed through internet, in the Spanish tax authorities electronic site, by telephone or at the Tax office, with prior appointment.

✔ In 2018, as in the previous year, all taxpayers, whatever is the nature of their taxable income, can obtain a draft of the tax return through the internet service “RentaWeb”.

In order to obtain the reference number, taxpayers must communicate their Tax Identification Number, the expedition or expiration date of their Spanish ID number and the amount of taxable income declared in box 475 of their 2017 Renta return. If the taxpayer has not filed a tax return in the previous year, an international number of a Spanish bank account (IBAN) shall be necessary.

Taxpayers with an Identity Number for foreigners (NIE) will have to provide the holder’s number (“Número de Soporte”).

✔ As a new feature this year with regards to the tax return contents, the following must be highlighted:

• Maternity tax credit: this tax incentive is increased as it includes the custody expenses of children under three years old in kindergarten or authorised educational centres.
• Large family tax credit: in order to increase population growth, this tax credit is raised up to 600 euro for each child forming part of a large family exceeding the required number of children so that the family qualifies as a large family in either the general or special category.
• A new tax credit applies in favour of taxpayers whose family resides in another EU Member State or European Economic Space country and cannot elect for a joint tax return. With this tax credit, the tax quote payable is similar to that which would apply if all the family members were resident in Spain.

✔ Please keep in mind that all the Spanish Autonomous Communities have approved their own general table rates: some of these tables are more progressive than 50% of the Spanish general table rates, as it happens with Andalucía, Aragón, Asturias, Baleares, Canarias, Cantabria, Cataluña, Extremadura, La Rioja, Murcia, or Valencia. Others have a less progressive tables, as it is the case of Castilla y Leon and Madrid.

Besides, it is convenient to review the tax credits that may result applicable depending on the region you live in, as all the Autonomous Communities have their own tax credits or have modified the State ones.

✔ A Renta season in which the Spanish tax authorities keep on developing a model of assistance to the taxpayer, as a measure to prevent tax fraud. Remember, however, of the importance of seeking proper expert advice so that you can correctly comply with your tax obligations and, at the same time, reduce your taxation.