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Practical Income Manual 2019.

Delimitation and conditions for its application

With effect from January 1, 2018, and in order to adapt our regulations to European Union Law, a deduction has been established on the quota in favor of those taxpayers who are members of a family unit in which one of its members reside in another Member State of the European Union or the European Economic Area, which prevents them from submitting a joint declaration. In this way, the fee payable by the taxpayer residing in Spanish territory is equal to that which would have been borne if all members of the family unit had been tax residents in Spain.

Conditions for applying the deduction

The deduction may be applied by those taxpayers who meet the following conditions:

  • That is part of one of the following types of family unit referred to in article 82.1 of the Personal Income Tax Law :

    1. That made up of spouses not legally separated and, if any:

      1. Minor children, with the exception of those who, with the consent of their parents, live independently of them.

      2. Children of legal age who are legally incapacitated and subject to extended or renewed parental authority.

    2. In cases of legal separation, or when there is no marital bond, that formed by the father or mother and all the children who live with one or the other and who meet the requirements referred to in rule 1 of this article.

  • That the family unit is made up of taxpayers for Personal Income Tax and residents in another Member State of the European Union or the European Economic Area

  • That with the Member State of the European Union or the European Economic Area in which any of the members of the family unit resides, there is an effective exchange of tax information in the terms provided for in section 4 of the first Additional Provision of Law 36 /2006, of November 29, on measures for the prevention of tax fraud.

    There is an effective exchange of tax information with those countries or territories that are not considered tax havens, to which the following applies:

    1. an agreement to avoid international double taxation with an information exchange clause, provided that said agreement does not expressly establish that the level of exchange of tax information is insufficient for the purposes of this provision;

    2. an agreement to exchange information on tax matters; or

    3. the Convention on Mutual Administrative Assistance in Tax Matters of the OECD and the Council of Europe as amended by the 2010 Protocol.

    Notwithstanding the above, regulations may establish the cases in which, due to the limitations of the exchange of information, there is no effective exchange of tax information.

Cases excluded from the application of the deduction

This deduction will not apply when any of the members of the family unit: