Help. Moved to Spain for company

Afternoon all,

I'm in a situation that I am not sure what todo and need some advise.

I am Woking for a company in Ireland and they wanted to open an office in Barcelona. I offered to move. This was in November last year.

After months of fixing up my house to rent, I moved here to Spain with my wife and two young children last week, and due to start work tomorrow.

I need a letter from my employer to state my taxes are being paid in Ireland and also a e101 form ( think that's the one)

They are now stating that I'm confussed and I am working in Ireland, just based out here! And will not do the form, nor the letter.

I can not get my kids enrolled in school with out this form, and a letter in the mean time. Nor can I get an apartment as they want to see that I am employed full time and not a risk.

So now in Barcelona with my family after uprooting them from Ireland.

Can some one please let me know what an employer should be doing in this situation, as surly they can not ask some one to move countries and then not support them.

Thanks in advance,

A worried man,

Phil

Who paid for the flights and movement of household goods to Spain. Do you have a contract?

Hi bronte,

There was no assistance in the move. I had to pay for everything, as there were no relocation funds. I had to pay for all the flights and the shippers. I did ask for some days off extra to my holiday to help us out a bit. I was given two extra days!

Oh, and my contrtract is on going. Ive been working for them since October 2008.

You must have had discussions, do you have email proof of what has occured. Did the company know you were moving your family? Has your pay been transferred to Spain?

Yes, I have emails, It's a small company of 8 employee's. My pay will still be paid into the Irish back as it makes no difference to us to transfer from there to our Spanish account, once we get it open.

Sorry to hear about your situation and even more sorry that I can't help, but one thing I would say is that if the letter your are talking about is similar to the one I had to sign on behalf of an employee a few weeks ago, then it is only useful for a short stay in Spain - 3 to 4 months. Once you spend more than 183 days there you will be liable for taxes regardless of how the salary is actually paid out, at least that was the case for our guy.

Form E101 I think is an exemption from local social security taxes and as far as I know this has limitations too...

I really think you need to seek professional advice, but I can't think of anyone to suggest other than perhaps one of the big international accounting firms, they usually have people that handle these issues...

Jim (Switzerland)

I'm sorry to hear about your situation. I was in this situation before. I know how frustrating it is when you move to somewhere new and have to manage everything from the start. It happened to me before when I move from Italy to Ireland for a company. I will tell you how my company and I have managed this issue. This may help you.

My Italian company has bought an Ltd company in Ireland for a while before they decided to send people to work here. When they sent me to Ireland, they gave me a new employment contract for a company in Ireland, and another contract stating that I will work for a company in Italy on the year next in order to protect me when I want to move back in Italy. This 2 contracts can be renewed every year.

An Italian company is not so nice too. At first, they didn't want to give me any pay raise or any moving expenses. However, I told them clearly that I would never move if they couldn't give me what I want. Finally, I have a payraise, a monthly house rent for 800 euro, 1,000 euro for shipping expenses, and the company would buy me a flight anytime I want to go back to Italy, just the company will not pay for my wife.

Once I work in Ireland, the company outsources payroll service. I receive a payslip from a payroll company every month. My salary is paid and I pay tax in Ireland. A company's income that occurs in Ireland go to Irish Revenue for tax. Of course, a part of income that is difficult to distinguish still goes to Italy.

Is a new office a legit company in Spain? If not, you should tell the company to make it a legit company. Once it is a legit company, the company should outsource some HR company to make a payroll for you in accordance to Spanish laws. They should give a new employment contract for this new Spanish company. You should be now working for and receiving your salary from a new Spanish company, not a company in Ireland anymore.

Now I am moving back to Italy. The company in Ireland will give me P45 that I am not working in Ireland anymore, and I will start my employment in Italy soon.

This is a complex situation, and you may need to take legal advice.

However, in the main, if your company seconded you and did not put in place either a tax protection policy or tax equalisation policy, and you are going to be there long-term, the company is likely to be liable to operate some form of Spanish withholding tax from you.

If you are going to be non-Irish resident they probably should not be deducting Irish tax, but that will depend on the length of your secondment.

In the long run, the operation of PAYE/PRSI or Spanish withholding is the liability of the company, but if they do nothing but operate Irish taxes and PRSI, you will have to sort it out yourself each year by filing the relevant tax returns in Spain and Ireland.

www.taxingtimes.ie

Sounds like your firm has not done some basic due diligence in advance of sending you off to Spain.

I lived and worked in Spain for 4 years. My hubbie was employed and being paid in Ireland but working in the Spanish office of his company. His tax and PRSI status was complicated and his company employed an international accounting firm to sort things out for him (as it turned out, they were useless and caused almost more trouble than they were worth - but at least they were the ones liable for their mistakes, not us!). He ended up paying tax in Spain and PRSI in Ireland. This made things somewhat complicated in terms of our entitlement to social services in Spain as you point out (we couldn't register for the public healthcare system for example, as the OP points out).

My advice would be

- tell your company that you need immediately to have access to a international accountancy firm that can sort this out for you and they need to pay the costs. You need to know what your Spanish tax liability will be and make sure that it is paid; likewise, you need clarity on your PRSI status

- make sure you and all your family have EHICs (they are valid for 2 years). That entitles you to once-off and emergency care in the (excellent) Spanish public health system

- check again re the school thing - Catalonia might be different but for the rest of Spain, you just need to be registered with your local municipality (empadronado) to access the Spanish public school system. Even illegal immigrants have this right, so you should also. However, you do need an address to do this.

A quick call to the Irish Embassy in Spain might help.
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