Q&A from March episode of Ask My Lawyer in Spain
We have recorded the transcription from the first episode of ‘Ask My Lawyer in Spain’ recorded on 27th March 2020.
Alex Radford said “Good afternoon everyone. Thank you for joining us today on our weekly zoom seminar.
On the zoom call I have my colleagues Isabel, Rosario, Patricia and Debbie today.
Just a bit of information on what we are doing. Our office is closed to client meetings. Our receptionist is working from the office and the rest of the team are working digitally from home. We continue to receive instructions on a range of legal matters and we are organising telephone and video calls with our clients located around the world.
Thank you to all of those who have provided us with questions to make this session more interactive. We will go through the questions and at the end of the session take any further questions you may have or welcome any comments you have re the lock down.”
Question and Answer session
Employment and Tax
I have lost my job with a UK company based in Spain due to coronavirus and wanted to enquire if the government here had a scheme like the UK furlough agreement that covers part of the salary?
Isabel: It is necessary to confirm if the company you have the contract with is based in Spain or in the UK. That will define which rules are applicable. We need to see the notification letter in order to provide advice.
If the company is based in Spain there are several scenarios. For example the temporary suspension ERTE or the dismissal which entitles you to the special ‘State of Alarm paro’. If you are not contracted again to regular employment, unemployment benefits ‘paro’ or unemployment ‘subsidio’ will be applicable depending on your work history. And you would be entitled to a redundancy fee as well. As many temporary contracts are not valid as such under labour law, you might want to consider contesting your dismissal by filing a ‘demanda’.
Are tax returns still due or are they likely to be delayed?
Isabel: It is necessary to submit the tax returns on time but it is possible to request a postponement of the payment with more flexibility and better terms than the usual postponement terms. For example the Governmentmay grant 3 months without interest (Carencia)
Do you have to declare your Qrops ( Pension ) on the Modelo 720? Can you please confirm and whether this should be declared under section 3 of the type of assets?
Alex: Yes all assets over the value of 50,000 euros per person should be declared in modelo 720 and they have until the end of March to do so.
I have a UK Pension which is small, but is paid to me after UK tax is deducted. However, it would be below my taxable threshold here in Spain, where I would pay no tax, or most likely less than the UK deduction. Can I do anything about this (maybe get it paid with no tax deducted in the UK and then declare it here but pay the lower or zero rate of tax)?
Alex: If the total of the annual gross pension (without deducting the taxes paid in the United Kingdom) does not exceed 14,000€, there is no obligation to make an income statement in Spain for the 2019 financial year. If it exceeds 14,000€, you would have to present it and deduct taxes paid abroad to avoid double taxation.
Regarding the pension plan, this is what the AEAT says:
There is no obligation to inform about the pension plans (of the contributions to them) as long as the incidence that gives rise to the collection of the pension in temporary or life annuity does not occur.
If I became a resident of Spain in September last year and didn’t break the 183 day rule, when will I have to file my first tax return, and what year will it be for?
Alex: I understand that as this person did not spend more than 183 days in Spain in one year then they are not considered a tax resident for 2019. If they spent more than 183 days in 2020 then they would have to submit their Spanish tax return in 2021 between April and June and declare any assets over 50,000 euros in 2020.
Can you please explain the benefits available to a single person, self employed “autonomo” under the current special measures?
Isabel: Self-employed workers with severe losses will be able to access a special benefit (prestación).
The benefit will last for a month, with the possibility to be extended until the state of alarm is over.
The benefit will be calculated with 70% of the regulatory base – calculated by average income over the last 180 days, or 70%, or their minimum income if they haven’t been in employment for 180 days.
It will only be granted to the self-employed whose activity is suspended by the declaration of the state of alarm, or who can prove a 75% loss in earnings over the previous month compared with the last 180 days.
Self-employed workers will be exempt from paying Social Security contributions.
The benefit will be “compatible with the exoneration of the payment of quotas to the Social Security” and with the approval of TEMPORARY LAYOFF (ERTE) for its workers, if it has salaried employees.
Apart from the benefit the government has approved a line of bank guarantees (Línea de Avales) to facilitate the access to entrepreneurs and companies for financial aid. The government provides this guarantee and the applicant has to apply for this at the bank.
And how do you apply for them?
First of all, you must calculate the average of the income from October 2019 to 9th March 2020 to calculate with the last month income. It is important as well that to apply for the benefit you must be up to date with Social Security payment (if not you have 30 days to regularise the situation).
The worker must process ONLINE through the official website SEPE (Public State Employment Service) the document with the competent authority to get this benefit. Once completed, the system will request a photocopy of the DNI/NIE/PASSPORT, Modelo 145 (to communicate your personal data and calculate the personal income tax retentions), and confirmation that you are up to date with the Social Security fees.
Applications should be submitted before 14th April (subject to be extended) and the authority will respond within 30 days.
I am a single mother and my children are aged 8 & 10. Can I take them to the supermarket with me?
Rosario: Yes, you can take the children with you if you do not have anyone who can care for them. Please, remember that you can only go out if you have a justification, like going to the supermarket, the doctor or pharmacy. Also remember that the police can stop you in order to ask for the reasons for breaking confination. We would recommend that you take with you your ID and your child/children’s ID (Passport, DNI or Residence card).
Do I still have to let my ex husband have my children at weekends?
Rosario: The general rule is yes, however, some judges have recommended not to move the children during weekends, and the time lost by your ex-husband will be compensated after confinement.
If your ex-husband or persons in contact with him are suffering coronavirus he cannot take the children with him, as it would be a real risk for the children.
If the father or the persons in contact with him are not suffering from coronavirus and you are suffering coronavirus or persons in contact with you, the father can request the children to stay with him during the lockdown due to the risk of infection.
Judges are recommending flexibility in order to avoid disputes between parents, as family courts will only act for urgent cases, like serious risk for children, child abuction, child abuse and neglect.
My ex-husband has lost his job and stopped paying maintenance. What can I do?
He cannot stop paying maintenance unilaterally. He has to obtain from the court an order to reduce child maintenance and in the meantime he has to pay. If he does not pay, you have to start a court process in order to claim maintenance, but this process has to be started once lock down is lifted.
I’m looking to obtain my NIE number and spend a period of more than 3 month within Spain (possibly 6 months) I appreciate that the police stations are now closed, can you advise on what are the process is?
Patricia: At this moment the police stations are closed to obtain the NIE, although they may accept issuing NIE if it is urgent. The urgency must be proved and the acceptance will be subject to the police’s criteria
Before the lockdown I had a mortgage offer, can I still complete the purchase and mortgage during lock down?
Isabel: Yes in fact the purchase with mortgage is defined as an urgent situation for the notary to accept the signature of the same (basically because the mortgage offer has normally a validity deadline).
Cadastral/Escritura – My wife and I want to ensure our house/title deeds are correct. We have a sneaking suspicion the deeds do not mention an area of property? Are you able to help us confirm our suspicions and submit title deed corrections to the official authority?
Alex: please send us a drawing of the area and a copy of your deeds and we can check with the Land Registry
I have an appointment at court for a claim against a builder who did not do the works at my new property properly. Do I have to attend?
Rosario: Civil courts are closed during lockdown, therefore you do not have to attend. The court will set another date for the hearing, you will be informed about the new date after confinement.
I have to send a formal letter to my landlord giving notice about cancellation of contract. In the contract is stated that termination of contract has to be done by a formal letter with recorded delivery. How can I send the formal letter?
Rosario: Post Offices are open during this period, therefore, you can attend the Post Office in order to send the letter. Please, remember to take your ID with you and the letter, or the proof of delivery, in order to show it to the police if they ask you for your reasons for breaking self-isolation.
My Lawyer in Spain want to remind you that breaking confinement is only for justified reasons. We suggest you can speak with the Landlord in order to agree to send the notice by email, rather than leaving home in order to attend the post office.
Due to the current situation with COVID-19 in Spain and the UK, is it true we are able to apply for a mortgage holiday as currently the resort is closed and we have no potential rental income available to be recovered until such times restrictions are lifted?
Patricia: I am afraid the possibility to apply for a moratorium on the payment of the mortgage it is only applicable in mortgages of the main residence. Therefore, non-residents are excluded at the moment.
Also, would we still need to pay our communal fees to the resort if again it is closed?
Patricia: In regards of community fees, these are still payable. I would suggest you contact the community administrator to see if they are planning a temporary reduction of the community expenses.
Can non-resident homeowners in Spain still accommodate tourists from England?
Debbie: No, all new guests in this period of Lockdown are banned from staying in rental properties until the 12th April, or possibly later if Lockdown is extended.
If the guests are already in Spain (including the Balearic and Canary Islands) and renting the property, they will be able to stay in said property until the lockdown is lifted (currently, this will be until 12 April, however, this may well be extended) or until the rental agreement expires. Only under certain circumstances are these rental agreements extendible.
They will have to adhere to the lockdown rules, which are to stay indoors (unless there is a valid reason to venture out, eg: one person allowed to go the supermarket, pharmacy or clinic/hospital).
They will not be allowed to use any of the communal facilities (including gymnasiums or swimming-pools).
All Spanish frontiers are currently closed to Non Spanish Residents and Foreigners.
Can I sign a Spanish will?
Patricia: Yes, you can sign a Spanish will. If you have a property in Spain it is advisable to have a Spanish will in place. Most notary offices are still open but only signing documents of an urgent nature and subject to the notary´s criteria. Most of the notaries however will accept signing a Will.
In fact the pandemic situation is specifically ruled by our civil code artículo 701 del Código Civil which allows granting a will without notary witnessing even from hospital for those who are there isolated as long as there are 3 witnesses older than 16 who speak the testator’s language and they cannot be close relatives. This article has never been used.
Thank for you for all attending and we will be here next week at the same time so as the situation evolves and changes. Please submit your questions for this week’s Q&A which will take place on Friday’s at 15:00 Spanish time via zoom. More information here