Spain’s wealth tax is regulated by law 19/1991. In 2008, law 4/2008 established a 100% tax credit against wealth tax liability beginning on 1 January of that year. However, as a consequence of the economic crisis in Spain, the wealth tax was temporarily reinstated between 2011 and 2017. Thus, declarations of wealth tax liability must be made from 2012 until 2018.
Although Spain’s autonomous governments collect about €1 billion each year from the wealth tax, the Spanish legal system has not mandated the imposition of the wealth tax in autonomous regions for the year 2018. Nonetheless, Andalusian taxpayers should not claim victory over the wealth tax. The Spanish government may still change its enforcement of the wealth tax throughout the country.
Who has to pay the wealth tax in Spain?
A Spanish resident is required to submit a declaration of wealth tax liability if the value of his or her total assets or rights exceeds €2 million. This declaration is based on a personal obligation.
Individuals who are not residents of Spain must pay the wealth tax if the value of their Spanish assets exceeds €700,000. This declaration is based on a real obligation.
What is the scale of the Spanish wealth tax in Andalucía?
In the autonomous community of Andalucía, the tax rate is calculated based on the following scale:
|Taxable base until X in euros||Tax sum in euros||Rest taxable base until X in euros||Applicable tax rate|
Is the Spanish wealth tax still valid in 2018?
Yes. This will be the last year of the wealth tax. Beginning in 2018, the 100% tax credit against wealth tax liability will be reinstated. Therefore, no one will need to pay the wealth tax in 2019.
Effective 1 January 2018, a 100% tax credit for the wealth tax will be applied to all taxpayers with a personal or real obligation to declare their tax liability.
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