https://goo.gl/maps/hU4W74VY6YCE9m5M8UPDATED 29th January 2020
BREAKING NEWS: Tenerife Guru has learned that the National Police are currently refusing to issue new Residencias to UK Nationals in all Police Stations in Tenerife EXCEPT IN SANTA CRUZ , namely at:
Address: Calle La Marina 20, Santa Cruz 38001. Tel: Tel: 922 999316 / 922 999317 (Open 9.00am – 2.00pm)
TO AVOID A LONG QUEUE, IT IS RECOMMENDED TO EMAIL REQUESTING AN APPOINTMENT IN ADVANCE:
This is because of uncertainty over the UK’s exit (or otherwise) from the EU at the end of October 2019. Perhaps they are concerned about the wasted cost/time of issuing residencias where such UK nationals may be required to come back the following month to apply for an entirely different TIE card anyway (see our article on BREXIT here). However, we will issue updates on the situation as soon as we have further news.
CONTENTS OF THIS PAGE:
- What is Spanish Residency / Residencia?
- Spanish Residency Card (Plus link to BREXIT update)
- Application for Residency (normal)
- Financial Requirements to obtain Residency
- Obtaining a Replacement Residency Card
- Permanent Residency rights after 5 years
- Application for Permanent Residency
- Financial/fiscal Residency in Spain
- Spanish Residency Applications for Non-EU Citizens
What is Spanish Residency / Residencia?
Much confusion reigns over what Spanish Residency actually means and what is required to obtain it. Below, we will explain ‘residency’ and the distinct concept of fiscal/financial residency.
First and foremost, the legal definition of ‘residency’ in Spain is simple. If you stay in Spain for more than 182 days in any calendar year, then you are deemed a ‘resident’ by the authorities. It’s that simple. However, whether a particular person is ‘recorded’ and known to the authorities as being a resident in Spain is an entirely different matter.
The truth is that there is a minority of foreigners living in Spain who pretty much refuse to put their name to anything official and quite happily float through life living ‘in the black’. Their reasons for doing so vary almost as much as their colourful pasts. Whilst most discover fairly quickly that they need at least an NIE number to survive in Spain, a large number never take the next step and apply for residency.
However, the reality for most law-abiding people who make the decision to come and live permanently in Tenerife is that at some early stage they will apply for residency (colloquially referred to by locals and expats as ‘Residencia’).
The rules governing residencia for European Union citizens are set out in Royal Decree 240/2007.
Under Article 6, stays of less than 3 months in duration are considered touristic as opposed to residential. For such individuals, a valid EU passport is all that is required to enter the country and stay for up to 3 months.
Under Article 7, EU citizens who wish to stay for more than 3 months shall be entitled to do so, provided they have obtained their NIE number and then proceed to register in the Central Register of Foreigners by applying for a Residency Certificate. So technically, this means that you are supposed to apply for Residency in Spain if you plan to stay for more than 3 months, even if you plan to leave before completing the ‘6 months and one day’ legal definition of residency.
After obtaining an NIE number but BEFORE applying for Residencia, applicants must first also obtain a ‘Certificado de Empadronamiento‘. This is to prove you are actually living in Spain by the point you apply for Residencia. (click here for details). Once obtained, you can then apply for your Residencia Card.
IMPORTANT: Once you have registered and obtained your Spanish Residency Card as an EU citizen, provided you continue living in Spain, your Residencia DOES NOT EXPIRE, nor does it ever require renewing, despite certain official sources or websites claiming otherwise. However, if you leave Spain for more than 12 consecutive months, then your Residencia is technically revoked. So, provided you are able to continue to support yourself and any dependents financially, you can continue to reside in Spain indefinitely on the standard green Residencia Card.
Some people confuse this standard Residencia with ‘Permanent Residencia’, which is an entirely different status requiring a different application (essentially solidifying your right to reside in Spain forever regardless of your circumstances). We discuss Permenent Residency separately below.
Please note that the above primarily applies to EU Residents. So, UK Nationals should continue to monitor the Residency situation in light of Brexit – Click HERE for further information.
Below (top) is an example of the new credit-card-sized green card, whilst below (bottom) is an example of the old green A4 certificate:
In years gone by, the residency document was a plastic credit-card-type card. However, due to privacy complaints from the European Union, the card was abolished and replaced with a flimsy green sheet of A4 paper. A few years back, this was shrunk down to an equally flimsy green credit-card-size piece of paper, which is the type still being issued today. Those with the old A4 certificate can apply to swap it for the new small green card.
Many people take the new flimsy card to their local photocopy shop to get it laminated for protection, despite the fact that legally, the document should not be altered or enhanced in any way. However, we have yet to see any business or authority refuse to accept a laminated card. Although in Tenerife, anything is possible!
Application for Residency (normal)
The residencia application is very similar to the procedure for applying for an NIE number.
You must download, print and complete form EX18, which can be found HERE
You must also complete Payment Form 790, which you can fill in online HERE and print off or download directly. You must then print it off and take the completed Form 790 at a bank to pay a fee of €12,00 in advance of the appointment at the Police Station. Not all banks accept cash payment against these forms. However, we understand that most La Caixa Bank branches do accept them.
IMPORTANT CHANGE SINCE JUNE 2019
For Police Station Applications for Residency Cards, it is no longer possible to simply turn up and queue on any given morning. To do the above Residency application at the Police Station, you must now apply ONLINE for an appointment in advance. The official web-page for requesting appointments can be found HERE
At the Police Station Appointment, you need to bring:
- Completed Application Form EX18
- Modelo 790 Form stamped with the €12.00 payment by the bank
- Original and a photocopy of your passport
- Original and a photocopy of your Empadronamiento Certificate.
Financial Requirements necessary to obtain Residencia
Since 2012, to obtain your initial Residency Certificate or Card, you must prove that you will not become a financial drain on the state by satisfying at least ONE of the following 4 conditions:
- You are employed or self-employed in Spain;
- You have sufficient resources to support yourself AND any dependents that intend to accompany you (which must be at least the Spanish minimum wage);
- You are enrolled as a student in a recognised educational establishment AND have private medical insurance covering all risks AND have sufficient resources to support yourself and any dependents.
- You are a relative (from anywhere in the world) joining or accompanying an EU citizen who complies with one of the requirements at 1 – 3 above.
- You are retired in Spain.
Proving any of the above criteria by production of the relevant documentation or evidence should fairly self-explanatory.
Specific rules apply where an EU citizen initially complies with the above but who’s circumstances change (e.g. finishing a study course, losing one’s job, or going off on extended sickness leave), but in many such cases there are ways to maintain one’s residential status provided you cooperate with the authorities.
Article 7 states that in proving ‘sufficient resources’, there is no set amount of savings or income required. However, the recent practice, at least in Tenerife, is that you will be requested to show that you have in excess of 5,000€ Euros (per adult applicant) in a Spanish bank account, or proof that you have an income equal to, or greater than, that amount per annum. If retired, you can instead show that you have an income or pension(s) equal to or greater than the Spanish state pension.
Any documents you produce as evidence of your above financial status that are not in Spanish MUST be officially translated. Furthermore, documents originating outside Spain may also need to be Legalised/Apostilled in the country of the document’s origin for international use. For UK documents, you can check if your document(s) needs to be legalised HERE. If so, you can proceed to apply directly on the same website, pay the fee and then post the document to the Foreign & Commonwealth Office for stamping with the apostille and returning. You can select for your document(s) to be couriered worldwide for a small additional fee.
If your document is not on the list of documents capable of being legalised, then an official translation should be sufficient in Spain.
AFTER you have received the apostilled document (or if the document cannot be apostilled/legalised), you must THEN get it officially translated. A list of Official Translators in the Canary Islands can be found HERE (scroll down for Tenerife translators). Alternatively, do an online search as there are other official translators in Tenerife not featuring in this list.
Obtaining a replacement Residency Card
For anyone needing to replace their residency card (e.g. lost, damaged, stolen, change of address, upgrading from an old A4 certificate etc) then simply follow the same procedure as with initial residency using Forms EX18 and Modelo 790 with bank payment, plus supporting documentation, but instead tick “Duplicado” (duplicate) in the box in form EX18.
If you are unable to produce the old certificate/card, (e.g. lost or stolen cards/certificates), the police may first require you to fill in a Police Report explaining the circumstances behind the lost or stolen card. You can do this at the Police Station, or you can also now file a Police Report by telephone. See HERE for how to do this. They have English speaking operators available from 9.00am to 9.00pm every day of the week.
Permanent Residency rights after 5 years in Spain
As explained above, the basic green Residencia Cards DO NOT EXPIRE, NOR DO THEY REQUIRE RENEWAL. Confused residents have previously read on the National Police Website (‘Sede Electronico’) that the certificates expire after 5 years in accordance with Article 7 of Royal Decree 240/2007. However, EU residents can rest assured that there is NOTHING in Article 7 that refers to the certificate expiring. For those wishing to check for yourselves, you can access the text for Article 7 yourself HERE or put it through Google Translate.
In any event, after having resided in Spain for 5 years and having complied with certain requirements, Spain offers a VOLUNTARY procedure to apply for ‘Permanent Residency’.
Given that the basic Residencia does not expire, many people ask whether there is any point in applying for Permanent Residency. Indeed, the vast majority of foreigners resident in Spain never actually apply for it. The application may however serve as a stepping-stone for those wishing to obtain full Spanish nationality and a Spanish passport. Also, in the unlikely event that the EU were to impose any residency restrictions on UK nationals following Brexit, this application could provide a way to stay in Spain permanently.
Application for Permanent Residency
The application for Permanent Residency is made to the same police station(s) where ordinary residency is granted.
You must show evidence that you have been living in Spain for at least 5 years plus additional information/documentation. This will include:
1. Your original residency certificate/card obtained upon your original arrival;
2. Evidence that you have lived continuously in Spain in the intervening period (e.g. rental contract(s), employment wage slips, utility bills, bank statements etc)
3. Evidence that you have been working, looking for work, self-employed, studying, self-sufficient etc
4. Evidence that you have sufficient income or funds to support yourself and any dependents.
5. Evidence that you qualify for public healthcare, or that you have a private medical insurance covering Spain.
You may also be asked to obtain a Criminal Records certificate from your home Country, details of any marriage or divorce, or certain medical certificates, depending on your personal history and circumstances in Spain.
Once you have satisfied the above requirements, you should be issued with a Permanent Residency card without undue delay. The card looks almost identical to the standard green Residency Card, but has different wording to reflect that you are now a Permanent Resident. This card then allows you to live and work indefinitely in Spain and to enjoy state benefits where applicable. You can also generally move between other EU member states and stay in any given state for up to 3 months without obtaining additional paperwork.
Fiscal / Financial Residency
Regardless of whether you have basic Residency or full Permanent Residency, you are legally required to take certain additional steps to inform relevant parties that you are now in fact resident. These include your bank, your employer and of course, the Spanish tax office (Agencia Tributaria).
The test for financial/fiscal residency in Spain is simply that you spend more than 183 days in Spain in any given tax year (January – December).
A fair percentage of foreigners living in Spain (who may already hold the basic green Residencia card or even a Permanent Residency card) still fail to comply with one or more of the fiscal/tax requirements. Whilst there are downsides to being fiscally resident in Spain (e.g. Spain will want to tax you on your worldwide earnings), there are various advantages, e.g:
- Resident bank accounts attract lower fees than non-resident accounts.
- Residents routinely receive more generous mortgage deals on better terms.
- Residents are not charged ‘notional income tax’ on their principal residence in Spain (Non-residents are taxed on a notional 2% income on each property even if they don’t actually rent it out!)
- Residents can make lifetime gifts or leave assets in Tenerife under their Will to first line descendants with a 99.9% reduction on Gift Tax or Inheritance Tax.
- Residents can sell a property in Spain without the buyer having to deduct 3% retention on account of your potential Capital Gains Tax liability
- Residents over 65 who have lived in a property for 3 years don’t have to pay any Capital Gains Tax when they sell, regardless of the profit.
- Residents may offset the costs of purchasing a new home against any capital gains applicable on selling their old home.
- New Residents may import a vehicle and various other personal effects within 12 months of arrival without paying the usual Customs Import Tax (subject to conditions).
As stated above, the potential disadvantage of being fiscally resident is that Spain will tax you on your worldwide income. However, this may not be a disadvantage to everyone. Many countries have higher income tax rates than Spain, but in Spain the higher-rate tax calculation kicks in at a lower amount than in most countries. Also, many countries have double-taxation treaties, meaning that if you have to pay tax in a foreign country, your country of residence (i.e. Spain) will give you a credit for that overseas tax paid, meaning that you don’t pay twice.
An additional disadvantage with being fiscally resident in Spain is that since 2013 residents are required to declare all assets held in other countries where those assets (or group of assets within one type) are worth in excess of €50,000 Euros. The relevant form for making the declaration is Form 720. Penalties for non-disclosure can be severe. The form can be completed online HERE if you have an electronic NIE / DNI or alternatively a ‘Cl@ve’ PIN.
Failure to correctly register your true residential status can technically result in a fine of €300. However, TENERIFE GURU has not heard of any case where this fine has been levied. We also suspect that €300 is not an effective deterrent for those with more to gain financially by avoiding Spanish residency.
The requirement to file a Resident Tax Return depends on your personal circumstances and applies regardless of whether you have yet applied for basic or permanent residency. If you spend more than 183 days in Spain in any calendar year, or have your centre of economic or vital interests in Spain, then you will be considered a resident for tax purposes. Thereafter, if you also earn greater than €22,000 income from any source in the relevant tax year (salary, dividends, business income etc), then you are required to file a Residents Tax Return.
Those actual residents who don’t file a ‘residents’ tax return are liable to late filing penalties plus interest on any tax payable. The taxman can go back up to 4 tax years in respect of false or non-declarations and unpaid tax. In addition, those who fail to register for tax-residency at all may be excluded from certain resident’s exemption schemes (e.g. a 99.9% inheritance tax reduction on assets they leave in the Canary Islands upon death).
Contrary to popular belief in some quarters, non residents in Spain must also file a non-resident tax return if they own any property in Spain, or earn more than €22,000 per annum from all of their Spanish based income.
For most foreigners who own a property in Tenerife but don’t earn any significant income here, they are simply required to complete and file a basic tax return (Modelo 210). Under this form, the taxman charges standard income tax upon a notional income of 2% per annum on any property held by a non-resident, even if the property is not rented and generates no actual income. This rule was introduced many years ago in response to the vast majority of non-resident owners renting out their properties but failing to declare the income. It is quite unfair on honest owners who don’t actually rent out, but that is the current law. Hence, the owner of a small apartment will typically pay a few hundred Euros per annum in respect of this tax.
Those non-residents who do rent out their property and who generate more than 2% income per annum are required to file a more detailed tax return, depending on the individual circumstances.
Due to the greater complexity (and cost) involved in filing a more detailed return, it appears that many non-residents just file the basic Modelo 210 and take their chances that they won’t get caught. Naturally, Tenerife Guru could never endorse such a brazen approach! The taxman is also stepping up checks to try to catch those renting out their property for a substantial part of the year. Such checks now include reviewing electricity and water usage for the property. Where such usage exceeds the deemed average use for 6 months per year (i.e. more than 50% of a typical permanent resident’s bill), further investigations may be conducted.
Spanish Residency Applications for Non-EU Citizens
Non European Union citizens wishing to apply for residency in Spain must first apply for a Residency Visa (Visado de Residencia) from the Spanish Consulate in their home country before travelling to Spain. The Visa cannot be applied for once you arrive in Spain.
There are 7 different types of visa, including retirees, investors, executives of a multi-national company, participants in a sporting or cultural activity etc.
Spain generally imposes income requirements on applicants seeking residency, evidence of which must be produced. Additional requirements include, but are not limited to, a criminal records certificate, a medical certificate, a financial reference (e.g. from a rental landlord) and evidence that you have arrangements in place to transfer necessary funds to Spain (e.g. already having set up a bank account in Spain plus a direct debit to that account from your home bank).
Non EU residents can also obtain a 2 year residence permit by investing a minimum of €500,000 Euros in Spanish property. However, if this is for a husband and wife, the investment must be €500,000 per person. The 2 year permit can be renewed provided that the minimum investment in Spanish property continues (even if you have changed properties).
Alternatively, investors can also acquire a similar permit by investing 2 million Euros in Spanish Bonds, or 1 million Euros in a Spanish company.