In cases where a person can be considered a tax resident in two countries, the provisions of the Double Taxation Agreement (CDI) signed between Spain and the other country must be taken into account in order to avoid, precisely, double taxation. This situation may occur if you:
- work displaced abroad for a short period of time
- live in one country but work in another
- live and look for work abroad and have transferred your unemployment benefits abroad from your home country
- have retired in one country and collect the pension in another.
At GD Global Mobility we are experts at analyzing CDI that establish the rules to avoid paying the same tax twice.
Types of Double Taxation Agreements
Most countries have Double Taxation Agreements to avoid having to pay tax twice for the same source of income; we, therefore, advise any person who is a resident or not and has income, earnings or assets in more than one country, to check if there is a Double Taxation Agreement in order to be aware of the tax obligations that they have in each country.
There are several types of agreements:
- Bilateral (between two countries): they affect income taxes (residents and non-residents) and assets
- Multilateral (with multinational organizations, such as the EU): they essentially affect taxes on commercial transactions.
Optimizing expatriate taxation
A correct knowledge and application of Double Taxation Agreements is key to mitigate any possible conflict of duality or fiscal residence, but at the same time it is also a powerful tool for fiscal optimization when displacement occurs.
Our department is expert at analyzing CDI to take advantage of all the tax benefits offered by tax legislation, both in the country of origin and the destination, while guaranteeing compliance with the tax and legal obligations of the tax authorities in the corresponding countries.
We can definitely help you achieve these goals. Contact us and find out about our service with no obligation.