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V0221-21 10 February 2021 · SG de Fiscalidad Internacional Criterion in force
IRNR · atribución de rentas

Non-resident community shareholder not required to declare IRNR if community makes advance income entry

A Spanish resident in Equatorial Guinea with 25% ownership in a property rental community asks about his obligations. The DGT responds that, as the activity is not economic, the community must make an advance income entry, thereby exempting the shareholder from declaring income.

The question raised

Question posed: Formal obligations of the non-resident co-owner.

The DGT's ruling

If the community of property does not carry out an economic activity, non-resident members are taxpayers of Non-Resident Income Tax (IRNR) without a permanent establishment. The entity is obliged to make a payment on account of the difference between the withholding tax incurred and that which would be applied directly to the attributed income. The practice of this payment on account by the community excludes the obligation to file a tax return by the non-resident co-owner. Notwithstanding, the non-resident may optionally file self-assessment Form 210 to request a refund if the payment on account exceeds their tax liability.

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