As a non-resident, you might not have been made aware of your tax obligations when you purchased your property here.
We can help you get started on the right foot, and use simple online forms to collect information when we need it, which you can fill in from the comfort of your own home – wherever that may be.
You’ll have different tax obligations depending on whether you rent your property in the Canary Islands or use it for yourself.
With either option, we set you up with a digital certificate so we can submit overdue taxes or communicate with the tax office online about any tax letters on your behalf. This means as an accounting company, we can act for you even when you aren’t on the islands.
Getting your digital certificate is easy. We’ll request a code which will be emailed to you directly. You’ll take that to the town hall, along with your NIE and passport and they’ll approve the certificate. All you have to do is let us know it’s been activated, give us the code and we can take it from there.
This is also known as the Imputed Income Tax. Whether you rent your property or keep it for personal use, you’ll have to submit an annual tax return based on a percentage of the cadastral value and the days rented (or not).
We submit this tax return in December for the previous year and we’ll remind you in November, so you don’t have to worry about keeping track.
The cadastral value can change a little each year, and is shown in your IBI receipt, the Canary Islands equivalent of a council tax. We’ll ask for your latest copy of that when we collect your information for the year.
If you’re a part owner of the property with your spouse, partner, sibling or friend, both of you will need to make a declaration.
If you were previously unaware of this, don’t worry, it’s not too late. We can submit the returns for the previous years you missed, and a very small fee will be added for late payment. This option is much cheaper and less stressful in the long run than receiving a fine from the tax office for non-payment.
If you’ve just purchased in the Canary Islands, we can get you set up in the tax system, giving you accounting advice and guiding you through everything, from creating invoices to submitting your quarterly returns and any deductible expenses.
If you’ve been renting a while and haven’t been declaring your income it’s not too late. We can backdate your registration in the system to avoid potential fines later on. The online booking platforms all share information with the tax office, so if you’re promoting your property on a site like Airbnb or Booking.com, it’s best to take action voluntarily.
You’ll need to pay property gains tax on the profit made, but you can deduct certain expenses to help keep the tax as low as possible. If you’ve had an extension done on the property for example, and have official invoices, those can be deducted.
You can also deduct expenses related to the purchase and sale, such as notary and lawyer’s fees, or the commissions charged by the estate agent.
We have three months from the date of sale to submit the tax. We’ll take care of calculating the amount due and submitting the forms to the tax office on your behalf. If you were renting your home, we’ll submit the form to end the rental activity with the tax office.
A letter from the tax office can feel a bit scary, especially when you don’t understand the lingo. First of all, don’t panic! And please don’t be tempted to put your head in the sand Ostrich style and ignore it.
It’s often just to communicate that they need some clarification and we can help you work out what action you need to take, if any.
It’s important you contact us as soon as you receive it though, as they normally give you ten to fifteen days to respond. If you’re registered with us already and we have your digital certificate, we’ll be able to see the communication and deal with it on your behalf, well within the deadline.
Ivo and the team always respond to any queries I have promptly. I value the personal service they offer. If you want an accountant that cares, contact them today.
We can’t wait to meet you.
Send over your info and we’ll schedule a time to discuss your needs and find the best way to move forward.