Income tax return 2022 in Spain to be presented in 2023

The Welex team of lawyers and accountants is pleased to write a few lines on Income tax return 2022 in Spain to be presented in 2023.

The Income tax return in Spain is an annual procedure to regularize the tax situation of the previous financial year , i.e. to settle the Personal Income Tax (IRPF). This tax in Spain is levied on all income obtained during a financial year, such as: salaried employees (payroll), income obtained as employees (self-employed) or other income such as rents, dividends, etc. It is a direct and progressive tax.

It is a direct and progressive tax. The tax rate in Spain increases as income increases.

For its calculation, there are IRPF brackets for earned income, the result of which is the resulting percentage that must be applied to each income bracket to obtain the tax payable to the Treasury in Spain.

This year there are changes to the income tax brackets in Madrid, Galicia, Valencia, Andalusia and Murcia.

Income tax 2022 scale

General tax scale, income out our work, economical activities and pensions

– up to 12.450€                      19%.

– 12.450€ – 20.2000€             24%.

– 20.200€ – 35.200€               30%.

– 35.200€ – 60.000€               37%.

– 60.000 – 300.000€:             45%.

– More than 300.000€:           47%.

– Who must pay the Income tax in Spain?

Individuals whose habitual residence is in Spanish territory and those whose habitual residence is abroad in the cases established in articles 8, 9 and 10 of Law 35/2006, of 28 November.

Persons obliged to file personal income tax returns in Spain:

– Residents in Spain salaried employees with a single payer: they must declare if their income is more than 22,000 euros gross per year. Salaried employees with two or more payers: they must declare if their income exceeds 14,000 euros gross per year.

– Self-employed professionals in Spain with total income from work, from movable or real estate capital, or from economic activities or capital gains of more than 1,000 euros and capital losses of 500 euros or more.

– With total income from movable capital and capital gains subject to withholding or payment on account exceeding 1,600 euros per year in Spain.

– Those who receive only imputed real estate income, full income from movable capital not subject to withholding derived from Treasury Bills and subsidies for the acquisition of subsidised or subsidised housing and other capital gains derived from public aid that exceed 1,000 euros in Spain.

– Deadline Income Tax in Spain

 From 11 April 2023 to 30/06/2023

– Some of the new features of the Income tax in Spain compared to last year

This year those workers in Spain with an income of less than 15,000 euros, previously the limit was 14,000 euros, who receive income from work in the following cases will be able to benefit from the tax reduction:

• When they come from more than one payer, with certain exceptions.

• When compensatory pensions from the spouse or non-exempt maintenance payments are received.

• When the payer of the earned income is not obliged to withhold tax.

• When full earned income subject to a fixed withholding rate is received.

Income tax withholdings in Spain are lowered for income of less than 21,000 euros per year (previously for income not exceeding 18,000 euros). For those taxpayers who earn more than 32,000 euros, the IRPF withholdings will decrease from 2023 in Spain.

Change in the tax declaration for self-employed in Spain.

Deductions for improving energy efficiency: The time scope of application of the deduction for energy refurbishment works in predominantly residential buildings is extended until 31 December 2024.

Limit on contributions to pension plans: The general limit for deductions for contributions to social welfare plans is reduced from 2,000 to 1,500 euros.

Re-establishes the obligation to report on the transfer of use of dwellings for tourist purposes in Spain.

Exceptionally, the waiver or revocation of the waiver of the application of the objective assessment method may be exercised until 30 January 2022.

New developments in the payment and refund of the amount in Spain.

If the tax return is payable, the taxpayer may, simultaneously with the filing of the return, pay the tax by direct debit, make the immediate electronic payment after obtaining the full reference number (NRC), or obtain a payment document that allows payment to be made at a collaborating entity.

For payment by instalments in Spain, taxpayers may pay the tax debt resulting from their personal income tax return in two parts, without interest or surcharge: the first, representing 60% of the amount, at the time of filing the return, and the second, the remaining 40%, up to and including 6 November 2023.

If you wish to know more about the 2023 income tax return in Spain, or any other aspect of a fiscal or legal nature, the team of professionals at Welex on the Costa del Sol will not hesitate to help you with what you need.