The accreditation of non-residence is a key prior step for non-resident companies wishing to apply for their NIF in Spain. It is an essential procedure for many taxpayers, whether to avoid improper withholding, comply with certain tax obligations, or manage various procedures with the Tax Agency. In this process, the company must prove that it does not have fiscal residence in Spain to avoid legal issues and ensure proper interaction with the Spanish tax system. In this article, we will examine in detail what the accreditation of non-residence entails, the necessary documents, and the formalities required to carry out this procedure effectively.

 

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Tax obligation to prove Non-Residency

Paying taxes in Spain depends on fiscal residency. However, being a fiscal resident in the country or abroad involves different tax obligations. Taxpayers with fiscal residency in Spain are taxed on their worldwide income, while non-residents or foreigners are only taxed on income obtained in Spanish territory (link to the post on tax obligations of non-resident companies with NIF in Spain). In both cases, taxation is subject to what is determined by a Double Taxation Agreement. So, who is required to prove non-residence?

  • Individuals: Those who generate income or own assets in Spain but have their fiscal residence in another country.
  • Companies: Foreign entities conducting business activities in Spain without having their fiscal domicile in the country.

It is important to highlight that the determination of fiscal residency is a factual issue that must be proven by any valid legal means. Simple registration does not, by itself, constitute sufficient proof of residency and habitual residence in a particular locality.

 

Documents required to prove Non-Residency

To prove non-residence, the Tax Agency requires the following:

  • Certificate of fiscal residence: Issued by the tax authority of the country of residence, certifying that the individual or company pays taxes in the country.
  • Validity of the certificate of residence: The validity period is one year. For example, a German citizen residing in Germany who wishes to prove non-residence in Spain can obtain a certificate of fiscal residence from the German authorities. This certificate will be valid for one year and, if their tax situation remains unchanged, the certificate must be renewed after that year.

However, if the taxpayer is a foreign State or one of its political subdivisions or local entities, the validity of that certificate will be indefinite. This differentiates States and governments from individuals and companies, as the fiscal situation of the former does not change.

  • Additional considerations: It is important to note that, according to the Tax Agency, fiscal residence is not solely determined by residence permits or administrative residence in a country. An individual may have a residence permit in a country but not be considered fiscally resident in it.

 

Reasons to prove Non-Residency

Among the reasons that justify proving non-residence, we find the following:

  • Avoiding double taxation: By proving non-residence, it is possible to apply the provisions of the double taxation agreements that Spain has signed with other countries, thus avoiding double taxation on the same income.
  • Justifying tax exemptions: By proving non-residence, it is possible to benefit from tax exemptions or reductions provided for non-residents in Spanish legislation.
  • Managing administrative procedures: Some procedures, such as applying for the NIF or declaring assets in Spain, require proving non-residence for proper processing.

 

✅​ Need help with the procedures?

Proving fiscal non-residence is essential to assess how a transaction should be taxed and avoid penalties. Additionally, proving non-residence is a prior or complementary step for applying for the NIF in Spain. Without this accreditation, foreign companies may face difficulties in obtaining the NIF, as it is necessary to demonstrate non-resident status to be assigned the corresponding tax regime. Therefore, both processes are interrelated and fundamental to operate legally in Spain.

📞 Contact our professionals and discover how we can help you prove your non-residence or apply for the Tax Identification Number in Spain for your foreign company.

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