Spanish Tax Man Targets Expats With Gib Connections

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Spanish tax authorities are targeting British expats in Spain who own property in Gibraltar.

The government is stepping up pressure on expats with links to the British financial centre whose sovereignty has long been disputed by the Spanish.

Finance minister Cristóbal Montoro is concerned that more than 6,000 expats with property in Gibraltar regularly use Spanish public services but pay no tax towards their running costs.

He also claims almost 22,000 registered companies are based on the Rock and fewer than 11% pay any taxes.

Montero argues this leads to lost tax revenues of £800 million from companies earning revenue in Spain but funnelling the cash to Gibraltar where they pay no tax.

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The government in Gibraltar has dismissed Montero’s claim as a ‘flight of fancy’ and produced figures that show only 102 Spanish nationals hold shares in 66 companies on the Rock.

“Unsurprisingly, our records show that few Spanish nationals opt to use corporate or financial services on Gibraltar,” said a spokesman.

The Spanish government has campaigned for many years that Gibraltar should fall under the same tax regime as Britain rather than set local policies.

Black capital deal

Israel’s finance minister has struck a deal with German tax authorities as part of a crackdown on ‘black capital’ held offshore by expats.

As a result, letters have been posted out to more than 100,000 Israelis who are believed to own property in Germany asking them to make sure they have declared any rental income or profits on sales.

The tax deal with Germany allows tax authorities in both countries to swap data.

Tax laws in Israel demand anyone receiving rents from overseas should pay 15% tax on their gross profits, even if the money has already been taxed elsewhere.

Swiss settle £1 billion tax debt

The Swiss government has finished paying Britain and Austria back taxes on undeclared funds held in the country’s bank accounts.

Around £470 million was paid to Britain and £590 million to Austria on behalf of bank account holders and investors.

“These payments have seen Switzerland meet the terms of agreements with both countries,” said a government spokesman.

The deal offered taxpayers in Britain and Austria the option of allowing the Swiss to settle their debts or volunteer to regularise their financial affairs through the tax authorities in both countries.

More than 21,000 taxpayers in Britain and 24,000 in Austria agreed to let the Swiss government manage their tax debts. The British taxpayers declared wealth of £10.43 billion in Switzerland, while the Austrian figure was around half as much.

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