TAX REDUCTION TIPS FOR SPAIN

TIPS TO HELP REDUCE YOUR TAX BILL

 

 
If you’re a taxpayer in Spain, you only have 6 weeks left to think about how to save on your 2012 tax return. Here are a few ideas:

Home Improvements:

You have to earn less than 71,007€ and the improvements must be related to energy efficiency, hygiene, security, water-proofing, etc. Maximum possible deduction: 20% of taxable income. Make sure you keep an invoice in case it's requested.
   

Pension Plans:

You can reduce your taxable income by up to the lower of these amounts: 10,000€ or 30% of taxable income for people aged under 50 (12,500€ or 50% of taxable income if aged over 50). Additional allowances applicable in the case of disability or non-earning spouses.
   

Lunch, Nursery & Transport Vouchers, Medical Insurance:

If included in your work contract these aren’t taxable up to set limits.

Donations to Non-Governmental Organisations (must request certificate):

Donations in multiple names will only be attributed to the first person named. Reductions will depend on the type of NGO chosen.
   

Rental Income:

If you rent out a property and this is used as the tenant's primary residence, you can deduct costs (mortgage interest, maintenance costs, etc) and additionally 60% of the resulting rental income is not subject to tax. This allowance increases to 100% if the tenant is aged between 18 and 30 and on a low income.
   

Additional Deductions:

Each region in Spain has its own specific allowances that you may be able to include. Examples include educations costs, for single-parent families, etc. (See full list of 2011 allowances).

IMPORTANT: This is only a brief summary - check with your accountant ("gestor") as anything to do with the Tax Office in Spain tends to be subject to multiple pages of smallprint! 

Written by NativeEnglish

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