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V2621-20 3 August 2020 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · residencia fiscal

Tax residency and work income depend on presence, centre of vital interests and place of work

A US citizen consults on their tax residency in Spain while working remotely for a US company. The DGT explains that residency is determined by presence exceeding 183 days or the centre of economic interests, and how the Double Taxation Agreement avoids double taxation in case of conflict.

The question raised

Tax residence of the applicant in the year 2020.

The DGT's ruling

Tax residence is determined by domestic regulations (183-day rule or center of economic interests) and, in the event of a conflict, by the Convention, prioritizing the permanent home and the center of vital interests. If the worker is a resident in Spain, employment income is taxed in Spain because it is exercised here, even if the USA may tax based on citizenship by applying mechanisms to avoid double taxation. If the individual is not a resident, the income is considered to be obtained in Spain as the activity is carried out within Spanish territory.

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