Many foreigners have tax obligations in Spain but might not have a Spanish bank account to pay them from. Changes by Spain’s tax authorities might just make it easier, depending on your circumstances.
Navigating the ins and outs of the Spanish tax system can be a little daunting at times. That’s why many people choose to pay for a gestor to handle it all for them.
But for many foreigners in Spain, especially those with property in the country but who aren’t resident, figuring out when and how to pay your taxes can be extra complicated, especially if you don’t speak Spanish.
READ ALSO: What does a ‘gestor’ do in Spain and why you’ll need one
This was compounded by the fact that, for many years, you couldn’t pay Spanish taxes from a foreign bank account. As such, many people were forced to open a Spanish bank account for the sole purpose of paying tax.
Can you pay taxes in Spain with a foreign bank account?
Fortunately, it’s no longer like that. From February 1st 2024, the tax authorities in Spain started allowing tax payments via direct debit from any bank account within the SEPA area, removing the need for a Spanish bank account.
So, in short, yes, you can pay your Spanish taxes with a foreign bank account — depending on the country in which the account is based.
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What is SEPA?
SEPA stands for Single Euro Payments Area is a basically an integrated bank transfer system. SEPA includes all the EU members states, plus those in the EFTA (Iceland, Norway, Liechtenstein and Switzerland). The UK is also still member of the SEPA area, despite Brexit.
Before the change, you could only pay your taxes in Spanish via banks approved by the tax authorities.
READ ALSO: Spanish tax returns: A handy guide for foreigners
VAT and tax experts Marosavat explain that under the previous rules, “direct debit [was] only available when the taxpayer’s bank account belongs to a bank entity cooperating with the Spanish tax authorities. This requirement impose[d] an important restriction when using direct debit as a payment method, especially for foreign taxpayers.”
But slowly, the Spanish tax authorities have eased the rules and made it easier for foreign businesses and tax payers to pay their tax from abroad. First, in March 2021, the rules were relaxed for foreign businesses with tax obligations in Spain.
Then from July 2023 foreign accounts were approved for deferment and split applications of tax debt, and from February 2024 for regular tax payments.
Following the changes, Marosavat says, “the payments will still be processed through a cooperating bank entity, which communicates with the taxpayer’s bank entity. In consequence, all commissions and bank expenses related to the procedure will be passed on by the tax administration to the taxpayer.”
According to Spain’s Agencia Tributaria website, which you can find an English language version of here:
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Payments are allowed for those who do not have an open account in any collaborating entity in state collection management.
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It is especially intended for use by those who pay their debts from abroad.
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It can be done by both natural persons and legal entities.
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The payment will have releasing effects on the date of receipt and entry of the transfer.
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Non-resident property owners
This is particularly welcome news for second home owners in Spain, many of whom are non-resident and manage their properties from abroad for most of the year.
According to IberianTax, by extending tax payments to the wider SEPA area, “property owners can now continue to use their home country’s bank accounts or accounts from other SEPA countries to make tax payments towards their taxes. This change simplifies the process and alleviates the burden of setting up a separate Spanish bank unnecessarily.”
