Singing superstar Spanish tax case is warning for UK expats

The result of the ongoing tax case against singing superstar Shakira could be all too relevant for British expats who’re living in Spain and working overseas.

The Spanish tax authority is claiming the world-famous singing star has spent enough time actually living in Spain to be legally liable for tax on her massive worldwide earnings. The case depends on the actual number of days she was living in the country between 2011 and 2014 and whether her ‘vital interests’ were in Spain during that time. Vital interests include her partner, Barcelona soccer giant Gerard Pique, her two children and her home.

Shakira arrived in Spain in 2010 after having left her home country Columbia, and finally designated Spain as her home as late as 2015. Tax experts are warning expats who claim non-residency and are physically present in Spain for less than 183 days every year may still fall foul of the country’s tax authority. According to tax lawyers, it’s not uncommon for the taxman to investigate individuals as regards residency, as their status often determines their tax liability, If it can be proven they are resident, their entire world-wide income will be subject to Spanish tax and, if residency can’t be proved, tax due as a non-resident is only based on their earnings within the country.

Tax officials in Spain and many other countries popular with expats often make use of the phrase ‘tax evasion’, an unfortunate description suggesting a degree of criminality and intent to avoid paying tax by the individual concerned. In many cases, the omission can simply be down to bad advice by so-called tax professionals and, in the case of famous taxpayers such as Shakira, it’s likely the taxman is on a witch hunt due to the singer’s being famous and very wealthy as a result of her talent.