Relocation in Madrid

If you are moving to Spain or going to engage in any economic activity in this country, the most important and urgent procedure is obtaining your NIE.

NIE means Número de Identificación de Extranjeros -FOREIGNER REGISTRATION NUMBER-

It is a personal, unique and exclusive number.

Anyone who wants to live in Spain, whatever the reason of the stay or their nationality, must have a document with their identity number. It is legally required.

The Spanish are identified with their DNI (national identity document).

And foreigners are identified with their NIE.

Important information about the NIE:

• You need to get a NIE if you are going to stay in Spain more than 3 months. If your stay will be less than 90 days you can use your passport to be identified.
• You need to get a NIE if you are an EU citizen or a non-EU citizen.
• The number you will get assigned will last forever, regardless of your legal or working situation in Spain, and regardless of if you renew your residence permit.
• The NIE will always be your identification, but it won´t ensure your legal residence in Spain.
• You will need your NIE, in addition to be identified, to open a Spanish bank account, hire a mobile line with a Spanish carrier, do any financial transactions, file your taxes, buy a house or a car, do any formality with public administration…and much more….
• If you come to Spain with a family, all the members should obtain a NIE too.

How to get your NIE:

The process for requesting and obtaining the NIE is complex and it is important to ask for help. It is very different depending on if you are an EU citizen or not.

In this first case (citizens of a State of the European Union, European Economic Area or Switzerland) the process to obtain it is quite simple: you must apply for your registration in the Central Register of Foreigners (Registro Central de Extranjeros) and get the certificate with your NIE. This procedure can be done at the police station of the city where you are going to be staying in Spain. You will need to request to schedule an appointment. Here you can see Madrid´s police stations where they handle these issues.

In this link you can find more information (select Madrid and the formality you need to perform). It is very important that before going to the police station you make sure what papers you have to present in order to get registered in the Central Register of Foreigners and to get your NIE. It is common that they will ask for different documents from those you will find are required on the internet.

In the second case (foreign citizens not included in above) the process to obtain it varies greatly depending on your nationality and the reason for your stay in Spain. If you get a residence permit, then you should request a foreigner identification card which will show your assigned NIE. This card will contain your NIE, your personal data, your photograph, your fingerprints and the kind of residence permit you have in Spain at that moment.

We recommend you ask for professional help from anlawyer specialized in immigration issues, so you can get advice and file on time all the documentation requested by the Spanish authorities.

How to request a NIE for economic activity in Spain:

There is a special case in which you can and should request the assignment of a NIE, without being associated with a residence permit in Spain. This is called a temporary NIE or economic interests NIE. It is necessary when you want to do any economic activity in Spain, for example, set up a company or buy a property.

Remember that the NIE assignment is not related to being a legal resident in Spain, and also remember that the assigned number will last forever. For example, if you get a temporary NIE to buy a house and later you obtain a residence permit, your NIE number will be the same.

Finally, we recommend you to go to the Spanish Embassy or Consulate in your country to get informed about what you need to do for your specific needs.

If you are a foreigner, wanting to stay in Madrid more than 3 months and need professional legal advice, contact Mad. Relocation Services. We will help solve all the formalities associated with this process. You can consult this page for more information on the topic, but unfortunately it is not yet translated in English!

Are you moving abroad and needing to look for a new school for your kids? We help you find the options that fit your family´s needs.

You can use the following questionnaire written by an advisor specialized in the subject.

Personal Questions:

• For what purpose am I educating my children?
• What do I want my children to achieve in the coming years?
• How will I succeed in doing so? What are the most important values to me?

Questions for the school or other parents:

• How do they motivate children to do tasks they find hard or dislike?
• How do they discipline and incentive effort?
• How do they handle conflicts, what do they do in case of a fight and argument?
• What do they do when parents and school staff disagree?
• How involved do I want to be in my children´s school life?
• How does the school train their teachers? How do they convey knowledge? Do I like and share their way of doing these things?
• How do they manage differences between students?
• What do they do when a child is in an immature moment? What happens when children become bored due to lack of challenge? How do they handle isolated children? How do they motivate students? How do they set limits? How do they work to have coordinated classes?
• How does the school exchange daily information with families?
• What kind of parents do we expect to find at the school? What kind of parent will I be to my children´s friends? What kind of person am I going to turn into over the upcoming years? What do I need to know to be a better parent?

Other common questions:

• What kind of studies do students typically choose after finishing this school?
• How many students pass the entrance examination to college?
• How do they get these results? How do they handle students with very low or high levels? How do they manage to improve the test results for a specific student?
• Do students have a lot of homework in this school?
• What extracurricular activities are the most popular? Why?
• Does the parents association take an active role in the school? What are their proposals?
• Is the students´ lunch cooked in the school´s kitchen or is it catered?

Information written by Rocio Sanabria Gomez, from www.FamiliaExpatriada.com

Familia Expatriada provides coaching services for expatriate families, including the professionals, spouses and their children´s needs, along with emotional support in personal  and professional changes.

If you want to do this questionnaire with this advisor, you  can write to info@familiaexpatriada.com

For other needs, you can contact Mad. Relocation Services. We will be very pleased to help you find the best school in Madrid for your children.

If you are a foreigner in Spain but you are considered as a Spanish tax resident you are obliged to file yearly the Personal Income Tax (PIT) return with the Spanish Tax Authorities.

What does this obligation mean?

By means of filing the PIT return the Spanish tax resident individuals declare to the Spanish Tax Authorities the income obtained along the corresponding year (for instance and currently, 2012) and pay the resulting amount.

Who is obliged to file the PIT return?

The PIT return must be filed by all the Spanish tax resident individuals who obtained income in our country.

In general terms, an individual is considered as a tax resident in Spain if he/she spends more than 183 days per year in our country. Notwithstanding, the Spanish PIT Law establishes other criteria and presumptions in order to determine the tax residency that relate to the economic and vital centre of interests (for instance, if the spouse and children under legal age reside in Spain).

Besides, it is needed to analyse the corresponding Tax Treaty that may be applicable.

Additionally, it should be borne in mind that the tax residency is determined with different criteria to the legal residency or the labour or Social Security regime that could be applicable to the foreign individual in Spain.

Should I file the PIT return if I am taxed under the “Beckham” rule?

Yes, if you are a foreign individual tax resident in Spain to whom the Spanish Tax Authorities have granted the special tax regime for expatriates (“Beckham rule”) you are obliged to file the PIT return no later than the date mentioned below (regarding 2012, before 1 July 2013).

The main differences between the special and the “ordinary” regime refer to the tax rate that is fixed under the Beckham rule at a 24.75% (in 2012) and that only the Spanish source income is subject to taxation.

When do I have to file the PIT return?

The PIT return is filed once the Spanish tax residency is obtained. For instance, if the tax residency is obtained in 2012 because the transfer to our country was done in May 2012, the PIT return must be filed including all the income earned in that year.

What is the deadline for filing the return?

In general terms, the set period for filing the PIT return is between the beginning of April (in some particular cases) and the 30 June.

In particular, the PIT return corresponding to tax year 2012 could be filed between the beginning of April until the 1 July 2013 (30 June is Sunday).

What income must be included in the PIT return?

In the PIT return must be included all the income obtained in the corresponding tax year and in any jurisdiction (i.e. not only in Spain) as long as in Spain tax residents are taxed for their worldwide income.

This means that in Spain you are obliged to pay taxes for any income obtained disregarding the source or the place where it has been generated. In the case that such income has been taxed in other jurisdictions, the Spanish regulations foresee tax credits for avoiding double taxation.

In particular, the following income must be declared: salaries derived from labour relationships, professional fees derived from independent activities, rentals from immovable property, financial interests, dividends, capital gains and losses, etc.

How is the PIT return filed?

In the event that you are a foreign individual applying the special tax regime for expatriates, the tax form can be obtained from the Spanish Tax Authorities site: www.agenciatributaria.es

Our advice in this case is requesting the collaboration of a lawyer specialized in tax issues and, in particular, in the special tax regime’s application as long as it is a specific regime that has been amended several times and cause several doubts in its practical application.

The advice of a tax lawyer specialized in the mentioned regime will help you to avoid subsequent tax contingencies and to be taxed in the proper amount.

Which documentation do I need to gather and provide the tax advisor in order to file the PIT return?

The tax advisor will need to be informed about your personal, family and economic situation.

Additionally, he will need information and supporting documentation (tax vouchers, certificates, etc.) of the salaries obtained, financial interests, dividends, any transaction with tax / economic implications, immovable property owned, pension plans, donations, etc.

In the event that the expatriates regime applies, you must inform him as long as the information to be provided and the tax return will have particularities.

Which additional obligations exist before the Spanish Tax Authorities?

In addition to the PIT return, it should be borne in mind that in Spain exist several tax obligations. Among them we should highlight the Net Worth Tax (directly linked to the PIT return) and the tax return (form 720) of the rights and assets located abroad (recently passed).

In relation to the latter we should remind that all the Spanish tax residents must declare yearly the assets and rights located abroad. The duly filing of this form is very relevant taking into account the penalties foreseen if any data or requirement is not fulfilled properly.

Post written by Enrique Iñiguez de Ciriano Gómez, lawyer specialized in tax matters. You can contact him or Mad. Relocation Services for any doubts or needs. We will be very pleased to help you.