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V2930-14 30 October 2014 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · residencia fiscal

Possibility of claiming foreign work exemption for Spanish tax residents

A Spanish citizen working in a permanent mission in Switzerland inquires about their tax residency and eligibility for the foreign work exemption. The DGT determines that, in the event of a residency conflict, the taxpayer is a Spanish tax resident due to having their centre of vital interests in Spain, allowing them to claim the exemption under article 7 p) of the Spanish Personal Income Tax Law.

The question raised

Tax residence of the applicant in the years 2013 and following. In the event of being considered a tax resident in Spain, the possibility of applying the exemption provided for in Article 7 p) of the Personal Income Tax Law.

The DGT's ruling

If a conflict of residence exists between Spain and Switzerland, the Double Taxation Convention must be applied, prioritizing the location where the taxpayer has their center of vital interests. In this case, as there is a permanent residence in both countries, the center of vital interests is located in Spain due to family and asset ties. If the taxpayer is a resident in Spain, income from work effectively performed abroad for a non-resident entity in a country with an information exchange agreement is exempt up to 60,100 euros annually.

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