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Calculation of days to determine tax residence: not all absences are intermittent

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Regarding the Supreme Court's decision on 28th November 2017

The Supreme Court, on 28th November 2017, issued a judgment of cassational interest confirming the ruling of the Supreme Court of Asturias. In this, the court upheld the request by the taxpayer for the refund of the amounts withheld for Personal Income Tax during the time he was abroad and was granted a scholarship by the Instituto de Comercio Exterior (Spanish Foreign Commercial Service), since he did not have the status of tax resident in Spain.

The controversy lies in the traditional administrative criterion regarding the calculation of days spent in Spain for determining tax residence. To the huge number of companies that have posted workers abroad and have requested a binding consultation, the administrative criterion came to say that, unless they showed a certificate of residence (appropriate means) or accredit their tax residence in another state, they could be resident in Spain according to the criterion of days spent, and consequently income tax payers.

This assessment was based on Article 9.1. a) of the Personal Income Tax Law, which establishes that intermittent absences must be included for the calculation of the 183 days spent in Spain, except when the taxpayer accredits his tax residence in another state. Thus, the administrative doctrine considered that if the worker did not prove effective residency in another state, any absence was considered intermittent, therefore it was counted as days of stay in Spain.

The Supreme Court of Asturias has already expressed its opinion on this matter, which has now been ratified by the High Court. An absence of more than 183 days from Spanish territory cannot be understood as intermittent. The concept of intermittent absences must exclusively address the objective criterion of the duration or degree of stay outside Spanish territory, and their concurrence cannot be linked to an intentional element of return to Spain. Also, given that it is not covered by the rule itself, once it is established that the absence is not intermittent, the taxpayer does not have to prove their residence or taxation in another state, as previously required by the Administration.

Consequently, the ruling provides that the 9 months the SFCS scholarship holder was posted to Romania cannot be understood as having the nature of intermittent absence and that he/she is not required to prove his/her residence in Romania. Thus, he/she cannot be considered a tax resident in Spain for the criterion of days spent in Spain, and must not be taxed by PIT but by the IRNR as a non-tax resident in Spain. Therefore, he/she is entitled to a refund of the amounts withheld as income tax.

Let us hope that, because of these rulings, the administrative criterion regarding the interpretation of the calculation of the days spent to determine tax residence, which was based on a doctrine without any normative basis, will be modified.


For your information and knowledge, you can consult the Judgment of the Supreme Court of 28th November 2017 at the following link.


For more information, please contact:

Jaime Varanda

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