Avoiding Double Taxation Between Spain and USA

June 26, 2008 By: erik Category: Complaining, Spain, USA 16,632 views

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Spain and USA Flag MergeMy tax situation is very unique. It will be less rare in 40 years, but I’m probably one of the first full-time transatlantic telecommuters. I’m an American citizen working for an American company, which pays me in US dollars into an American bank…….but I live in Spain.

Logically, it makes sense to pay taxes in the country in which you reside. I’m using the Spanish transportation system. I can get free medical care at the Spanish hospital. The Spanish police force is protecting me from criminals. The health of the Spanish economy is putting food in the grocery stores and therefore on my plate. I have a Spanish mortgage. I should be paying taxes in Spain.

That would all be true, I believe, if the other country involved was not the greedy superpower that is the United States of America.

This post has background music. Click play below before continuing. Or don’t.

Luckily, there exists a Convenio de Doble Imposición Tributaria Firmado Entre Estados Unidos y España (Double Taxation Income Tax Treaty Between the United States and Spain).

This document can be found in Spanish here (only the first few pages are available for free), and the English version is here, brought to you by the ever helpful SpainExpat.com.

The letter to the US President at the beginning of the English version of the treaty starts:

THE PRESIDENT. I have the honor to submit to you, with a view to its transmission to the Senate for advice and consent to ratification, the Convention between the United States of America and the Kingdom of Spain for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes on Income, together with a related Protocol, signed at Madrid on February 22, 1990.

The letter is signed by Lawrence Eagleburger. Could you come up with a more American surname if you tried? I think not.

The treaty spends a lot of words talking about royalties and works of art, so I presume that it was originally intended for people like Penelope Cruz or Antonio Banderas that live in one country but perform in another.

The important part of the treaty that applies to me is Article 24.

ARTICLE 24: Relief from Double Taxation
1. In Spain, double taxation will be avoided, in accordance with the relevant provisions of the law of Spain, as follows:
(a) Where a resident of Spain derives income which, in accordance with the provisions of this Convention, may be taxed in the United States, other than solely by reason of citizenship, Spain shall allow as a deduction from the tax on the income of that resident an amount equal to the income tax actually paid in the United States.
Such deduction shall not, however, exceed that part of the income tax, as computed before the deduction is given, which is attributable to the income derived from the United States.
(b) In the case of a dividend paid by a company which is a resident of the United States to a company which is a resident of Spain and which holds directly at least 25 percent of the capital of the company paying the dividend, in the computation of the credit there shall be taken into account, in addition to the tax creditable under subparagraph (a) of this paragraph, that part of the tax effectively paid by the first-mentioned company on the profits out of which the dividend is paid which relates such dividend, provided that such amount of tax is included, for this purpose, in the taxable base of the receiving company.
Such deduction, together with the deduction allowable in respect of the dividend under subparagraph (a) of this paragraph, shall not exceed that part of the income tax, as computed before the deduction is given, which is attributable to the income subject to tax in the United States.

Believe it or not, it’s not much clearer in Spanish. What this boils down to is:

  1. Pay your taxes in the United States as if you were living there. This value is X.
  2. Calculate how much tax you would pay in Spain if you had made that income in Spain. This value is Y.
  3. Calculate the difference (Y – X) and, if it is greater than zero, pay that to the Spanish government.

Simple, right? Well, no, actually. Because the first thing the US government asks you when you go to pay your taxes is, “Whoa!! Wait! You don’t live in the US!? Before you can file your taxes, you need to tell us how much tax you paid to the country you’re residing in!” Thank you, Joseph Heller, for giving us a term for this kind of bureaucratic nonsense. The system forces you to lie to one of the countries in order to break into the Catch-22 loop. After evaluating the situation carefully, I decided the that the easiest and smallest fib I could tell was that the taxes withheld from my paycheck was exactly equal to how much taxes I had paid in the US (X in the equation above). This is not strictly true, because sometimes they give you money back and sometimes they ask for more money when you actually file, but darn it, it’s pretty close! So there, I have my X.

Now what about Y? If I made N dollars in 2007, how much Spanish tax would I pay if that had been in Spain? Well, first we have to change N into euros. So what exchange rate do you use? The one on December 31, 2007? Jan 1? July 1? The median? The mean? ARGH!!! Reasoning through this at the local tax office, we decided that the most fair way would be to convert every single paycheck to euros with the exchange rate on the day that the check was deposited, whether I transferred it to my Spanish bank at that time or not. In Spain, most people are paid at the end of every month, and often the amount varies depending on how many work days the month had. My salary, however, is fixed, but I get paid biweekly, so I had 26 paychecks in 2007. Luckily, I get paid on Fridays and Google Finance (god, that’s a depressing chart!) keeps historical data from the close of markets on Fridays. So I went back and recorded the exchange rate on the date of every paycheck, entered the values into a spreadsheet and calculated the exact amount of euros that I earned in 2007 assuming that I had converted my entire salary to euros with no exchange commission fees as soon as I received the money. This, of course, resulted in the depressing realization that my biweekly paycheck, which was the same value in dollars for the entire year, was 300€ less in December 2007 than it was in January 2007. There are, indeed, some drawbacks to transatlantic telecommuting.

Once we had my year’s salary converted to euros, the Spanish tax computer could quickly calculate how much tax I would have paid in Spain: Y. And you’ll never believe what the difference came out to for me in 2007…

Y – X = 24€

After all was said and done, and all these complicated calculations took place, I had to pay the Spanish government 24 euros.

This rather surprised me, because I had always had the American prejudice that Europeans are taxed to death in order to pay for all the socialist policies like health care and actually giving retired people pensions that they can live on. It turns out that the tax rates in Spain and the US are more or less equal.

  • I was wondering how this worked.

  • hmmmmmmm.

  • My submission for a slightly more American name is Chevy Eagleburger.

  • Chevy Yankeeeagle.

  • great post. I’ve also been doing something like this for the past few years. If you get paid in the USA, however, how does Spain know about this income?

  • Good question, Tyler. It’s because big chunks of money arrive from el extranjero in the bank account in my wife’s name. And the Spanish government flags that kind of behavior (as it should, really) and won’t allow her to file her taxes until it’s explained.

    They didn’t notice until 2007, and I’m not tellin’ anything else.

    (Si lees esto y trabajas con Hacienda, estoy hablando hipotéticamente. Segíºn los papeles, no vivia tanto tiempo en España antes de 2007 para necesitar declarar mi renta.)

  • Hehe, no worries Erik. Not sure if you’ve seen it, but we’ve got some good threads on the forum on our site that talk about stuff “hypothetically” too.

    So they noticed in 2007. How did they contact you? Or was it directly through your bank? Couldn’t you have just been transfering your savings?

  • Normally, if everything is fine, the Spanish government will more or less do your taxes for you. But if there’s a problem, they send you a letter saying, “Hey, something strange is going on here. You need to go to a tax office and explain some things.” That’s what happened to my wife. So we had to explain about me and my work situation. Which meant I had to file taxes here, which is why all this happened.

    I suppose we could have claimed that it was all savings (and that I sit around at home all day doing nothing). But you can’t just move money around like that. When we transferred the money from selling our house in England, we had to show the bank proof that the money came from a house sale.

  • Eagleburger Eagleburger Eagleburger.

  • Don’t do that, Jane! Didn’t you see Beetlejuice?

  • candy

    Hi, I am sorry to join this post so late, just found it as I was researching the exact same situation. I have two questions that I hope you don’t mind asking:

    1) where can I find this “Spanish tax calculator?”

    2) it seemed you had to do this because they “caught” you when monitoring your wife’s account. What would happen if there is no way they could “catch” you, that is, you were paid US dollars in a US account and just extracted the cash from the Spanish ATMs when you needed it? I mean, my question is not “can you get away with this?” as obviously, despite any risks, you can. My question is, say this is your situation, but you WANT to pay those Spanish taxes. How do you register to Hacienda to get ON their radar?

    Does that make sense??

    Anyway, great blog. I’ve lived in Madrid for several years and love reading about other American’s experiences in this great country! Thanks for having it!

  • Hi, Candy. Glad I could be of some help.

    1) There is no “Spanish tax calculator”. I was just translating what the treaty says and doing the arithmetic with variables for clarity.

    2) They only “caught” me because we had been a little too honest about reporting my existence to Hacienda the previous year. From the stories I’ve heard of caught tax evaders, I would rather be as honest with Hacienda as I can (especially if it only costs me 24€ to do so!) than to have them catch up to me when I retire and have them take all my savings/pension away.

    I suspect that you could get away with your ATM scheme, particularly since Spain is such a cash-based economy. I thought of that and did so for a while in the UK, but the problem is that, if you’re going to do it with any decent quantity of money, you’ll have to be extracting the max limit every day and such regular withdrawals might raise an eyebrow on the other side of the Atlantic, particularly in post-9/11 United-terror-fearin-States.

    Like I said, you could get away with it, but if you might be living in Spain for a long time, it might be smarter over the long run to pay Hacienda its due.

  • candy

    thanks eric! but that is my question, if i DO want to pay taxes, how do I get registered? just show up at hacienda? maybe it is best if i find a gestor!
    thanks again!

  • Candy, when your husband files his taxes, go with him to the local Hacienda office and explain the situation. If he puts “married” on his taxes, they’ll want to “know a little about you for our files” anyway, so that’s the perfect time.

  • Nathan

    Thank you so much for posting this I will be making the move to Spain in the next two years but will be keeping my US job and bank account. I haven’t been fortunate enough to find someone who can give me good advice on how to maximize my US dollar by avoiding fees to exchange US to Euros and accounts that will allow me to convert when the exchange is best. Do you have any advice on the subject?


    • I don’t have much advice on the subject. I try to send money over as rarely as possible and send as much as I can at a time. As for figuring out the exchange rates, all you can do is look at the graphs and speculate just like any stock or commodities market transaction.

      One thing to be careful about is the fees that the bastard Spanish banks try to charge to receive your money. It seems ridiculous to me that a bank would charge to receive money, but that’s banking, I guess. My bank, by default charges a percentage (A percentage!!!) for each of my wire transfers. For the big ones sometimes this is as much as 300€. But then if I go to the bank and say, “WTF, you bastards!”, they always say, “Oh, sorry about that. We’ll credit that back to your account.” This is an important lesson for Life in Spain: You must complain all the time or people will walk all over you.

      If you can survive without a Spanish bank account (good luck paying utilities bills without one), then just taking money from an ATM machine with your US bank card is an efficient way to live, provided you don’t need any more than your daily limit per day. ATMs are generally pretty good about giving fair exchange rates.

      Oh, and make sure your US account is all set for allowing international wire transfers before leaving the country. Mine required my physical presence in a US branch to enable international transfers.

      Frankly I’m surprised that someone would be planning a situation so similar to mine. Buena suerte, Nathan! Let me know if you have any more questions.

  • Nathan

    My wife and I will be moving to her home town of Gijon as soon as she is done with school with our 11 old son Eli. The company I work for doesn’t care where I live as long as they can pay me in US currency in a US bank account. We will still have a US address for state taxes and work reasons but will be based out of Spain for the most part.

    One thing I want to have squared away before I move is the health care situation. I don’t want to unjustly depend on the Spanish health care system especially if I’m only obligated to pay US taxes – (whatever the Spanish tax system would charge). My wife had to take my son to the doctor in Gijon while visiting her folks for Christmas and it cost me 60 Euros. The question is can I buy insurance to cover this type of cost or do I swallow my pride and accept that my son is a Spaniard who’s father doesn’t pay into the tax system and is getting health care for free?

    Also, I assume you’ve married a Spaniard as well did you get your residency or are you still on a visa of some sort.


    • Nathan, that question is so American. No European would ever feel bad for not paying for health care, because, to them, free health care is a human right that everyone deserves. I’m pretty sure you only paid 60€ because you wanted to, and your son could have gotten free care (prescription drugs are not free, but are dirt cheap) with proof of his relation to his Spanish mother.

      Yes, it’s morally unfair to be living in a country where you pay no taxes and yet using the roads, sidewalks, police, fire engines, court system, buses, trains (*) and all the infrastructure that government tax money pays for. But until enough of us telecommute across borders so that the governments unbreak the system, there’s really nothing you or I can do about it. So just get over it.

      (*)Notice that Americans for some reason don’t feel like health care should be placed in this list, but any European would consider it ludicrous not to.

      I lived here for a bit with a UK work visa that let me stay in the EU, and after getting married, I now have residency, which is easy (as immigration paperwork goes) to attain with proof of marriage. And by proof of marriage, I mean that I think you’ll need to apply for a Libro de Familia (ask your wife), if you don’t have one yet. I’d start the Libro de Familia application ASAP if I were you. Expect to have to travel (in person, all three of you) to your nearest Spanish Embassy to get it, too.

      Hope that helps.

      • Juamagarcia

        As long as you or your son or whoever person is in Spain , you have the same rights than the Spanish people,,according to the Spanish constitution .this means , that you always can see the doctor for free, but you have to pay prescriptions , acording to the real value , you don’t have discounts , because you are not paying seguridad social in Spain.

    • Nathan

      Hello Erik…
      I found this thread from a few years ago and wonder if I can get your advice on another subject.

      I finally moved the family to Gijon and couldn’t be happier. However, on issue I’m having is the fact that everyone expects a nomina to prove my income which is US based. I cant even get a bank account open anymore until I can provide this documentation. Unfortunately, I’m getting a variety of answers from various people who ask for the nomina on what it should contain and how “official” is should be. Do you have any experience or advice on the subject?

  • Nathan it would be totally free for you as Erik says if you wanted it but there is now a system in place to pay for social security cover rather than going private if you need it.

  • Alex Furth

    Hi EriK. I am trying to recover some money from “Hacienda” and they are requesting a certificate indicating that in 2008 I was a fiscal resident of the USA. I’ve tried calling the US Treasury Dept, but they dont know anything about this. I think it has to do with the Double traxation Treaty. Any leads?

    Thank you

    • A “certificate”, eh? No, I’ve never heard of that. My employment with a US company seemed to be enough for me. I don’t even know what “fiscal residency” would mean. Sorry.

    • Anonymous

      I think that your US tax return for 2008 where you declare that you are resident (for tax purposes) is the closest you’re going to get. 

      You may be able to get the US embassy to give you a document declaring that the fiscal resident certificate doesn’t exist in the US and where you declare and swear that for that period you were a US resident. This will cost you a visit to the embassy and a fee to the embassy for issuing this “certificate”

    • jensk

      I do not remember the form number. I had to get one about 3 years back. I paid a fee then of $35. There is actually an application form on which you state the purpose for requesting this. In my case it took abut 4 months

  • Jose

    Hi Erik, thanks for your very informative blog. I am another American with relocation plans in the near future to my wife’s homeland, Galicia, and lots of questions about tax implications. I will be also a transatlantic telecommuter similarly to you and other bloggers.

    I did the math to find X and Y, but I do not get near the same results you did. According to my calculations, Y is twice the size of X and King Juan Carlos would keep in the end as much of my tax money as Uncle Sam.

    I have 401K contributions and a couple of exemptions, which lower my US taxes to around 12% of my gross income. When I do the numbers for hacienda the percentage climbs to about 25%. I apply a “standard deduction of €10K” for the sake of it, but it makes a little difference. I would have to apply a much larger deduction, which I am not sure would be allowed, to bring the Spanish tax near the US tax.

    Can you share more details of your calculations with us? What deductions do you use and how you handle them? I am having hard time lowering my Spanish taxes, considering that the tax bracket I am using is 37%, while the one for the same income is only 15% in the US. Any advise or comments from you and other bloggers is highly appreciated.

  • Victoria

    Hi there,

    Could anyone explain to me Article 14 of the CDI, BRANCH TAX?

    We are a US LLC, in the hydrocarbon services industry and we have a project in Spain. We are analyzing whether to settle a branch or a subsidiary, taking into consideration that we want to transfer the profits back to the US, and according to my understanding of the treaty, this would be the output for each case:


    TAX (35%) 35 35
    NET INCOME 65 65
    DIVIDEND TAX (10%) 6.5 0


    GROSS TAX BASE 65 100
    TAX (34%) 22.1 34
    PAYABLE TAX USA 15.6 0
    NET INCOME 49.4 65

    Thanks! V.

  • Wagner

    Hi Erik,
    I m in a very similar situation that you were couple of years ago, perhaps a slightly more complicated. I m Brazilian, living in the US, working for a US company. My company allows me work remotely from Madrid. I will receive my salary in the US, in USD, in a US bank account, paying taxes in the US.

    My understand of your post is if I make $100 in the US and pay 30% taxes and for the same $100 I would have paid 35% taxes; all that I need to do is to pay the difference for the Spanish government. Is that correct? Also how do I actually pay my Spanish taxes?

    Thanks a lot for help and sharing your experience.

    • Being a citizen of a third country shouldn’t complicate matters. Yes, you understand correctly. You need to go to your local Hacienda office and register with the system. Be sure to tell them about the Article 24 in the treaty I linked to. That should save them some time in finding the appropriate legislation. Good luck!

      • WD

        Thank you so much for the quick reply!!!

        Also, in general people can only stay in Spain for 90 days for every six months period without a visa . How were you able to get visa to stay in Spain for more than 90 days working remotely? Is there a visa for remote workers?

        By the way your link for the Article 24 English version is direct to a pdf The link for the Spanish version is directing for a website. Is that the correct link?

        Thanks a lot !!!!

        • I had a residency permit from the UK which allowed me to live in Spain past the 90 day limit. Then I married a Spaniard. I don’t know about visas for “remote workers” (great term!). From my understanding of the intent of immigration laws, I would think that there would not be a visa for that.

          You don’t actually need the PDF to go to Hacienda. You just need to tell them, “The appropriate legislation is in El convenio de doble imposición tributaria firmado entre Estados Unidos y España under Article 24.” They will have that treaty in a book in the office.

          • WD

            Thank you so much!

  • agala

    Hello Eric,

    I have the exact same situation, except I also have income in Spain. Do I report both US and Spanish income on my US 1040 as well as the Spanish tax returns? Also my wife (NOT a US citizen, unlike myself) has income in Spain, but no US income. Any clue as to whether it’s better to file together or separately in the US and Spain? It’s my first year in Spain and this situation is very unclear to us.

    To follow your example from the article, say Z is the tax I pay on my Spanish income in euros, and Z$ is the same amount in USD. Then would I report income from both countries to the US and deduct Z$ from my tax? Do you know on which line in the 1040 I do that? I suppose the reverse process would apply in Spain, just like you said, but I would pay Y-X+Z in Spain.

    I guess the only consolation is that I won’t be liable for US state tax.


    • It’s my understanding (I am not a lawyer) that the US won’t tax you on the first $85,000 you make abroad. So as long as Z$ ≤ $85k, you can safely ignore it for IRS purposes.

      I think that you calculate Y (what you would pay in Spain) including Z, so the equations get more complicated. The absolute best solution is to set aside two hours and go to your local Hacienda offices early in the morning and let someone there work it all out.

      Good luck!

      • agala

        That was fast! I think I’ll end up going to the Hacienda, yes.

        But as far as you know, there is no way to pay taxes from income in two countries in either? E.g., add the income from US and Spain and pay tax only in the US (or Spain, whichever is better)?

        • Correct. As reasonable as it might seem to only pay one country for all your income, the laws are not designed that way. You have to pay both.

          As with all laws, there’s always the “don’t do what the law says and hope you don’t get caught” strategy, but I personally prefer spending a day or two doing the paperwork, paying the small difference, and enjoying the peace of mind of knowing I’m doing the right thing.

      • James R.

        The Foreign Earned Income Exclusion for U.S. tax purposes is $91,500 for tax year 2010. You (according to U.S. law) must declare this income to exclude it. Since 2006 the excluded income is ‘stacked’ on top of any U.S. income to put the U.S. income in a higher tax bracket. So it’s not just a matter of ignoring it if you want to remain legal.

  • Barb

    Hi Erik,

    Same situation here, although I am a Spaniard living in the US for the last 8.5 years and making the move back home. I have some questions:
    1) I make $55,000 a year. Will I pay yaxes in the US? Some people are mentioning $87,000 and above is when you pay.
    2) working for an American company and getting paid in US account, will I have to register as an “autónomo” (freelancer)? If not, what will my status be? And how do I apply for Social Security benefits including healthcare? On what grounds? Will my jobless American hubby and daughter be covered by my health care in case I have the right to it?
    3) you said you have an hipoteca, did the bank find a problem with your particular situation? I am sure they asked for proof of employment, what did you use?

    Sorry for the many questions! You have truly provided information I could not find anywhere else.Thank you!!!

    • James R.


      If you are Spanish and return to Spain, you will be liable for Spanish taxes. Is the american company registered in Spain? If not, you will need to register with the Spanish Hacienda and Social Security as an ‘autónomo’ and effectivly ‘bill’ the american company for your wages. The Spanish bank will ask for your tax declarations when applying for a ‘hipoteca’. Check the Spanish Social Security site for information on family coverage for health care. Hope this helps…

  • WD

    Hey Eric,
    I hope you are doing well.

    It turns out that I will probably be working in the UK before I actually go to Spain. Do you know how to avoid double taxes between the US and UK if:
    1-Assuming a $100 income, I receive 100% of my money in the US?
    2-Assuming a $100 income, I receive 50% in my US bank account and 50% in my UK bank account?

    My company is willing to discuss an expat opportunity, but there is a concern on the cost associates with taxes and health insurance.

    My US health insurance covers me internationally through reimbursement. But to avoid paper work I would like to get health insurance in the UK. Would have an idea on what is the average cost for health insurance or a 36 old single guy?

    Thank you so much for your help here.
    You are truly enlightening a lot of people.
    Thank again

  • Joanna


    Do you know if the same scenario would apply if my husband and I are on government pension from the U.S., paying taxes on our pensions in the U.S. but will be living in Spain? In other words, would we have to pay the “difference” only in Spain?

    Thank you.


    • erik

      I have no idea. I’d guess probably not, but you should always check with Hacienda first.

  • John

    How were you legally able to telecommute from Spain? Did it require a particular type of Visa?

    • I married a Spaniard.

      • Mark

        Great answer, I am in a similar situation, but think it is more rare than yours, jajajaja. I like the answer though, and I am still confused and not sure what to do.

  • Heather

    Hi Erik, I found your post a couple weeks ago and am looking for some tax advice. My husband and I moved to Bilbao with our two kids (4 and 1), and I tele-commute as a DoD sub-contractor. This article has been really helpful, but I am full of questions…..

  • Heather

    Hi Erik,

    I found your website a couple weeks ago searching for tax advice (I have so many questions!) and have enjoyed reading your articles. I moved with my husband and kids (ages 1 and 4) to Bilbao in June. I telecommute as a DoD sub-contrator and am getting concerned about tax season. Would love to chat with you briefly if you have the time….

  • EB

    Hi, Erik. I’m an expat living in Spain too. I found your blog in a search about taxes. I’m scared to death. I’ve lived here for 16 years and I had no idea until recently that I’m supposed to be filing us taxes! I’ve been paying taxes here as I am paid by people here. I’m pretty peeved to find out that I have to report my income and that now banks are being obliged to tell the US government about your bank balance and the movements in your account. FBAR, is the law. It’s missing a U in my opinion. I’m afraid I’ll be fined. I didn’t know and never imagined….I wish I were GE, then I’d be a billionaire, not pay taxed AND get money back. Anyway, I shall begin to follow your blog. It looks like good stuff. Thanks.

  • Houston

    Hi, this is a great blog! Not sure if you can help with this….I will be working for a US company with US salary paid to a US bank acct. I will have a “reunion of family” visa because my American wife works for a Spanish company in Spain. Does the Spanish govt allow this? What does this mean tax wise for me? Thanks.

  • Anita

    Hello Erik, thanks for all the good info provided. I.m still having problems understanding the Double Taxation laws. I am a dual U.S./U.K. citizen who lives in Spain and has inherited in Madrid. I am all up to date in payment of Spanish taxes, but am getting conflicting answers to whether or not I have to pay U.S. taxes on the income provided by the rents in Madrid. Can you help me?

  • wallyconger

    Erik, hi, and thanks for your info. Question: I am retired in the U.S. If I relocate to Spain, am I obligated to pay Spanish income taxes.

    • I am certainly no expert on this, but from what I’ve seen, I suspect the answer is “no”, especially if all your income is from Social Security or private pensions.

  • Stephen Conley

    Hi Eric,

    Great post here. Has anything changed in the seven years since you wrote this?

    I’ve got many of the same questions. I’m American, married to a Spaniard, recently relocated to Valencia…run a virtual business with most clients and money coming from the US. I’m trying to figure out all of this tax stuff, especially for 2016.

    If anyone has any advice or a good contact to help filing with both the US and Spain, I would greatly appreciate it!

    • draphael

      Hi, Did you ever find an accountant who could help you? I’m considering doing a similar relocation keeping my US business, but can’t get an answer out of the accountants I’ve contacted about taxation. David Smith, Asheville NC

      • K Smith

        I’m also interested in anything you find out. My son married a Spanish citizen and is a legal resident of Spain while running a virtual business (website dev) that has most of it’s clients from the US and uses a NC address (since that was his state of residency before he moved).

        I help with the accounting part of his business and am trying to figure things out as well. I was under the impression that since he’s a resident of Spain, he had to file and pay taxes there first and then would get a foreign tax credit on his US taxes. BUT, apparently NC doesn’t allow a foreign tax credit for non-residents. I’m also unsure how the self-employment tax owed figures into the tax credit.

        If anyone has any insight, I’d appreciate it!

  • Mary

    Hi There. Can US Citizen married to Spaniard work for a US Company while visiting Spain with Husband? Does she have to pay Spanish Taxes? Does she need a work permit?

  • Carlos E. Riazuelo

    Hi Eric,

    Thanks for creating this page which is so helpful for many of us!

    Did the company that you work for classify you as an expatriate worker?

    I ask because I’m also an American citizen working for an American company which pays me in US dollars into an American bank. I also have a Spanish passport.

    I would like to move to Madrid but I would like my company to keep paying me in US dollars into an American bank, I would like to keep my 401K, my american insurance, etc. Basically I want to keep all my US benefits like if I live in the US.

    The company I work for is not sure if it’s possible to do this.



    • Amanda Fanoun

      Carlos, did you ever get a response to this question? I’m in this same situation. Would love to have more insight. Thank you!

  • Four Letter Nerd

    >It turns out that the tax rates in Spain and the US are more or less equal.

    Except Spain has a VAT.

  • draphael

    Hi Erik,

    I’m thinking of becoming a transatlantic commuter also, letting staff run my business during the time I would be in Spain. Has anything changed since your post 8 years ago? I understand that in France and Portugal Americans are exempt by treaty from paying taxes on U.S.-sourced income. Has that become the case in Spain? Otherwise, as someone else commented, national and state taxes in Spain are 37% for incomes between 35,000 euros and 60,000 euros, much higher than the 14% to 22% in the US.