On 25 April 2023, the Central Economic-Administrative Court (TEAC) issued a ruling (RG 04812/2020) on the calculation of the number of days spent in Spanish territory for the purposes of determining tax residence in Spain. In this resolution, the TEAC reiterates the criteria established in a previous resolution of 28 March 2023 (RG 4045/2020).
The TEAC begins by analysing Article 9.1 of Law 35/20016 on Personal Income Tax (LIRPF).According to this article, a taxpayer has his habitual residence in Spanish territory when any of the following circumstances apply:
- a) who spends more than 183 days during the calendar year in Spanish territory, or,
- b) who directly or indirectly establishes in Spain the main nucleus or the base of his activities or economic interests. To interpret this regulation, the TEAC also takes into account the Comments to Article 15 of the OECD Model Convention for the purpose of interpreting Article 9.1.a) LIRPF cited above.
The TEAC is based on the assumption that the number of days spent in Spanish territory must be determined on the basis of objective criteria, regardless of the possible wishes of the taxpayers, so that the tax residence of an individual is determined when it has been previously verified that he/she spent more than 183 days in Spanish territory in a specific calendar year, regardless of whether these days are consecutive or whether they are interrupted by continuous entries into and exits from Spanish territory.
In this resolution RG 04812/2020, it reiterates the criteria established in the previous resolution (RG 4045/2020) and clarifies that the concept of permanence according to article 9.1.a) of the LIRPF is made up of the aggregate computation of three stages: certified presence, presumed days and sporadic absences.The court then redefines each stage as follows:
"Certified presence: that which is established by incontrovertible evidence. Once a day's presence has been proven by the relevant means of proof, it is counted aseptically, without the need to prove (neither by the administration nor by the taxpayer) a stay of several consecutive days. The day is counted in full, with no minimum number of hours required. (Comment 5 to Art. 15 of the Model Convention OECD).
Presumptive days: those reasonably elapsing between two certified presences; although it is not known by certified proof that the person concerned was in Spain, as it is a reasonable number of consecutive days and is between days of certified presence, they can be counted as days of stay under Art. 9.1.a), unless certified presence outside Spanish territory is proven.
Sporadic absences: As is clear from the wording of Article 9.1 a) LIRPF, sporadic absences are an element to be added to the days of effective presence (made up of the addition of the days of certified presence and the presumed days) in order to determine whether the aggregate stay in Spain exceeds 183 days. They are, in short, a reinforcement to the conclusions of stay in Spanish territory or abroad, but, of course, they are not strictly essential when the minimum threshold required by the Law of 184 days has already been reached with the days of effective presence".
The ruling analyses the data and evidence provided by the tax administration and the taxpayer and represents an important step towards specifying how to prove whether or not the taxpayer has had his tax residence in Spain.
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