Antonio Jover and his son Jaime Francisco show the letters sent to them by Hacienda. :: A. C.
Pensions from Switzerland: The agreement with this country is that public pensions paid by Switzerland to residents of Spain are taxed in Spain, unless the pensioner has Swiss nationality, in which case he or she pays tax in that country, according to information from the Gestha union.
Pensions from Germany: The Spanish-German agreement that came into force at the end of 2012 establishes that pensions paid in Germany must be declared and taxed in Spain. Before that date, pensions paid to residents in Spain were taxed in Germany.
Pensions from France: Public pensions paid by France are taxed in France. Spain can only demand tax if the pensioner is Spanish and is resident in Spain, unless he or she has dual French nationality, in which case the tax is paid in France even though the pensioner lives here.
United Kingdom: Public pensions paid to British people by the UK are taxed exclusively in the United Kingdom even if the pensioner resides in Spain. Tax is only payable in Spain if the pensioner is Spanish and lives in Spain.
The first letters started to arrive about a year ago. Spanish pensioners who in the 1950s, 1960s and 1970s went to Germany, France, Belgium or Switzerland were dismayed to discover that Hacienda was demanding taxes dating back to 2008 for the pension they received from abroad, even though nobody had ever asked for this before. Since then, this newspaper has learned, more than 1,000 people from Malaga province who once worked abroad and some foreign residents in the province who receive a pension from their own country (this does not apply to British prisoners) have been called upon to pay back taxes on this income. However, the Association of Returned Migrants of Malaga (Asomer) believes the actual figure is considerably higher, based on the number of people who have consulted them about this situation.
Although the tax authority has not provided any official figures for the province, a few weeks ago the Minister of Finance, Cristóbal Montoro, indicated that 27,696 people had been subjected to inspections for not declaring a pension received from a foreign country. In answer to a question from the PSOE party, he said that each case was being studied individually to take into account “personal and family circumstances” and he insisted that “they are not being treated as fraudsters”.
That, however, does not appear to be the feeling of most of the returned migrants, pensioners who could be asked to pay up to 15,000 euros in unpaid taxes and fines for the last four tax years (those that they are still able to chase up). They consider this action to be unjust because they insist that their accountants and also staff at Hacienda whom they had asked about this had advised them that it was not necessary to declare the pensions, which until this year didn’t even appear on income tax forms.
In the case of Spanish people who once emigrated to other countries, they are obliged to pay because they are receiving money from two sources - a pension from abroad and another in Spain - which comes to more than 11,200 euros a year. According to sources at the tax authority, if people have not been contacted so far it is because no information has been available, but during the past year the information exchange processes with other countries have improved. This means that information is now available to Hacienda which could not previously be accessed and, for that reason, it can demand money from taxpayers retroactively for the pensions they have received from abroad. The same applies for some foreign pensioners who live in Spain and are obliged to declare the income they receive from their own countries.
The tax authority warns that it will be continuing to send out these letters, as and when it obtains information about money that is being paid to taxpayers from elsewhere.
However, the general secretary of the Gestha tax employees’ union, José María Mollinedo, recommends that those affected check the agreements between Spain and other countries to see whether they are really obliged to pay tax here on foreign pensions.
“They say they are looking at this case by case, but that is not so; if you don’t pay up at once they fine you and they issue an embargo,” complains Pilar Cabello of Asomer, the association which has already organised several protests in Malaga because of this matter.