A tax agreement between Spain and the United Kingdom in relation to Gibraltar

In short, we collect that last Saturday, March 13, 2021, the State Gazette was published International agreement On tax matters signed between Spain and the United Kingdom in relation to GibraltarHe said the deal It came into effect on March 4, 2021.

evidence Objectives They find each other:

• Eliminate tax fraud by establishing a system of administrative cooperation in tax matters that includes the exchange of information about specific categories of income and assets.
• Establishing rules for resolving tax residence disputes and avoiding the use of companies subject to the Gibraltar tax system by tax residents in Spain or to carry out economic activities in Spain.

The points mentioned in the agreement are as follows:

Protecting financial interests and good financial management. – All EU legislation and rules related to transparency, administrative cooperation, harmful tax practices and anti-money laundering will continue to apply in Gibraltar until the date when EU law ceases to be applied to capitals. As of the date when European Union law is no longer in effect in Gibraltar, legislation equivalent to that in force in the European Union on that date will continue to apply in Gibraltar.

Rules have been set for Resolve tax residency disputes In natural and legal persons, entities, instruments or other legal standards.

The agreement includes a series of standards for Resolve disputes in favor of residency in Spain, related to its presence for more than 183 days in Spanish territory and the location of the nucleus of vital and economic interests, as well as the family.

It settles down Special residency rules for Spanish citizens who transfer their residency to Gibraltar after the date of signing the agreementThey are considered exclusive tax residents in Spain. Non-resident citizens do not lose their tax residency in Spain Who provide evidence of their new residence in Gibraltar. This rule applies to the financial period in which the change of residence occurs and during the following four fiscal years. This rule does not apply to non-Hispanic citizens who spend less than a full fiscal year in Spain or to registered citizens of Gibraltar who spend less than four years in Spain.

Rules for the establishment of legal persons, entities and other instruments or legal forms. Tax residency is created exclusively in Spain for companies and other types of Gibraltar entities when they have a significant relationship with Spain

The competent authorities shall abolish, when necessary, double taxation in accordance with the provisions of their internal legislation. A special system for administrative cooperation in tax matters between the competent authorities in the concerned tax administrations. This includes a special administrative cooperation system Exchange of information On certain persons, income classes, and assets.

Regional expansion. As far as the United Kingdom is concerned, the agreement applies exclusively to Gibraltar.

If you need more information, please feel free call us.

Patricia Larrain

Executive Director