Open-letter-to-Mr-Rajoy-Autosaved

Open letter to Mr Rajoy.
Dear Heather
Many thanks for your email.
I am so sorry to hear that you are having to go through this nightmare. Believe me when I say that there
is no need to explain your situation; we know fine well that this country is an absolute disaster when
trying to deal with the tax office. I am at my wits end trying to explain to clients the way that Hacienda
works, because there is no logical explanation. Hacienda is not looking at long term goals; they want as
much money possible, in the shortest time possible. I perfectly understand all that you have explained
to me, but please know that with or without your email, we knew fine well that this was Hacienda's
fault, and not yours. We have hundreds of clients fighting battles against Hacienda. In my opinion,
Hacienda just hope that you will pay to avoid lengthy court cases. They are a disgrace.
All the best to you. There is nothing easy about living in Spain.
The paragraph which this letter commences with is an extract from the response I received from a
lawyer in Spain who deals with predominately non resident property buyers after I wrote to them to
explain why they had received a letter from Hacienda informing them I owed significant sums to the tax
office.
After living in Spain since 2002 I along with many others am being pushed out and my whole life and
livelihood being destroyed by the unjustified actions of the Spanish tax authorities and the unfair and
impossible process of challenging any decision the tax office chooses to make.
There appears, from what is happening to me, and other individuals, to be a campaign focusing on self
employed non Spanish nationals who are in the tax system in Spain. I suspect this focus is driven by the
fact that, despite having paid my income tax in Spain for the last 11 years, I and others in my situation
have no rights to vote at a general election. This makes us easy targets for unscrupulous tax inspectors
who have just, in their words, been told to go out there and smash it.
My business is that of mortgage arrangement. In Spain as with other European countries my activity
does not attract IVA as long as I undertake my business in a specific manner. This means I cannot just
present a client to a Bank I must demonstrate that I have access to a number of providers, can provide
my clients with deals they would not always achieve direct, I recommend and adviSe on products and
banks and collate and present the necessary documentation for risk assessment. I operate as a third
party intermediary within the scope of the laid down requirements and have done so with no issues
since 2004.
I am paid by the Banks on completion of a loan and I cannot charge them IVA as the activity is IVA
exempt.

Up until 2011 I paid myself a salary from my company. In 2012 the tax office informed my Gestoria that
as the Company Secretary I must re-register myself as Autonomo. This seemed to me to be rather
absurd as instead of the tax being paid in full each month only a retention would be taken and any
further tax liability, due to earning levels not being paid until the following year. As a 45% tax payer this
had no logic for me but I was given no choice in the matter.
Up until I was forced to move to Autonomo there had never been any challenge to the fact that the
business I undertook was not applicable for IVA and at this stage we had been trading for at least 8
years.
Without any warning early this year I received a demand from Malaga tax office for IVA payments across
all my 2012 and 2013 personal incomes, this has since been followed by a claim for 2014.
My Accountant who has dealt with my business and personal affair for years was shocked as the normal
process would be for Marbella tax office to question matters and allow me to present my evidence; I
apparently bypassed this process and was sent immediately a demand for the money from Malaga.
At this point I was not however unduly concerned as I knew what I did was not liable for IVA and that I
could demonstrate I met the rules for this being the case. On top of this I was also aware of someone I
know in the mortgage business, operating in exactly the same manner as me, having been challenged
the previous year by Marbella tax office as to why no IVA was being paid and having had the tax office
accept without any documentary evidence that the activity they undertook was IVA exempt.
For me however this has not been the case. None of my evidence on how I operate which has been
extensive and clearly demonstrates I work within the parameters for IVA exemption has been accepted
the feedback from the tax office in Malaga has been “you may operate in a manner by which IVA is not
applicable but if so go to court to prove it”.
If I wanted to go to court I would have to pay into court the full tax I am being pursued for. Given this
totals 70k I am not in a position to do so and quite frankly why should I have to. My only other course of
action is I go to tribunal, which I have done and then wait the 2 to 3 years it takes for the case to be
heard but suffer in the meantime embargos on my Bank accounts, my house, and be told by the tax
office (which has now happened) that I as IMS owner must not pay Heather Chambers any money. This
same letter goes to anyone who has ever had a financial payment link with me.
My time in Spain is now finished. I cannot pay myself, so from being an upstanding honest taxpaying and
mortgage paying citizen, I will become a mortgage defaulting non Spanish national who cannot work
because I have defaulted on my mortgage with one of the Banks I do my business with. I will be classed
as one of those non residents who came to live in Spain leaving a trail of destruction behind me and
justify for many the targeting of those of us who chose to live here rather than were born here. I will
become a self fulfilling prophecy.
Spain will lose my income tax, paid without fail each year, the contribution I make to other tax revenues
and streams from the business I bring in, and sadly will force me to leave a country I had considered to

e home and have always endeavored to effectively contribute to. Rather perversely I have never
claimed anything from Spain I have private health care and no children who have had to be educated.
This is not a matter of I tried to avoid tax and got caught out; I do not owe this tax. The whole system
however makes it impossible for you to fight unfair allegations. The whole onus is on you proving you do
not owe the tax rather than the tax office even having to remotely make any attempt to prove you do.
The time it takes to resolve, via the courts or tribunal, is not workable; nobody can put their life on hold
for 3 to 4 years or live on fresh air.
The tax office will ignore clear evidence money is not owed because they can. They behave more like
legal thieves and extort money rather than behave like a professional government body.
The current ruling by the tax office for me has wide implications because if I should be paying IVA then
so should every other mortgage broker in Spain, financial adviser and insurance company. I suspect
however if these are owned by Spanish Nationals who have a vote in Spain or are large organizations
who have pockets deep enough to challenge it they will not be targeted. This said hopefully the tax
office will take on someone with the financial means and clout to fight this all the way to the European
courts, unfortunately this will be too late for me.
No-one minds a fair and reasonable tax system but I now know of many incidences where companies or
individuals who do not have a Spanish name are being unfairly targeted. One has been told for instance
he cannot offset any expenses against profit even the invoice of his own accountant. The stories are
endless and all are equally as bizarre and clearly wrong. I do not wish to appear that I am xxxxxx and I
would never have thought this could be the case but mounting evidence, if you start to ask the
questions suggests this activity is now wide spread and there are too many instances to believe they are
just coincidence.
There is no argument with Hacienda, no ability for any negotiation, no logic or continuity in how they
apply or interpret the rules you either pay or have the money removed from your account and must
fight retrospectively. This is the actions of a third world dictatorship not a democratic European country.
The tax office in Spain would seem to prefer to focus on those of us who are legitimately in the tax
system paying our full dues and claim we owe more, than look for all those people who live in Spain
under the radar or working in cash related industries and not contributing at all. Non nationals in the
system are easy pickings who have little or no voice when it comes to fighting the unfairness of it all.
Good luck Spain for the future you will need it. External investment from other countries will be hard to
achieve as this vendetta to fill the coffers continues. Nobody who did any homework on the workings of
the tax office in Spain and the ability of the tax office to decide black is white would start a business here
or put themselves at risk personally.
Heather Chambers
heather@imsmortgages.com

0034 952 45 97 45