The General Tax Law considers communities as entities in attribution of income. And although, in general, they do not carry out business or professional activities (so they do not have regular tax obligations), they are considered as taxpayers because they pay professional or work income (janitor, janitor, administrator, cleaning company, etc.) for which they must withhold and pay into the Treasury.
In the usual cases of renting, the Treasury considers that this activity produces “Income from real estate capital”, instead of considering it as “Income from Economic Activities”.
Examples: Rental of rooftops for mobile telephone antennas, or facades for the placement of advertising tarpaulins, or even a local property owned by the community.
Therefore, the community of owners, in addition to filing the quarterly VAT liquidation, will be obliged to to file annually the income attribution form 184 when the annual income exceeds 3,000 euros.
What is Form 184?
This is the form used for the declaration of entities under the income attribution regime.
This is stipulated by article 90 of the current Personal Income Tax Law, which regulates the formal obligation of entities under the income attribution regime, among which are homeowners’ associations.
The model includes the income (referring to IRPF) to be attributed to each of the owners, because we must not forget that the communities of owners do not have legal personality for tax purposes to compute the income derived from the lease as an income. That is to say, it is each owner according to his coefficient, and not the community as such, who actually receives in that proportion an income that he will have to declare to the Treasury in his income tax return. Likewise, if the lease is for a use other than housing, it will be subject to VAT, which means that the community itself (for this tax it is a taxpayer as such) must also declare this tax.
What does it consist of? It consists of informing the tax authorities of the income received during the previous calendar year (from January 1 to December 31) and must be attributed to the co-proprietors resident or not in Spanish territory.
When are the communities obliged to declare the 184? When the attribution of income exceeds €3,000.00 per year.
Submission Deadline? Until January 30.
What documentation is required for submission?
- Annual income received from leases.
- Number of members of the community of owners.
- Ratio of quotas by owners: it is necessary to verify that the sum of all the components is 100% (this is very important, since the coefficient is used to assign the proportion of income that corresponds to each owner).
- Identification of all the owners during the fiscal year (both additions and deletions): Name, surname, ID or EIN and address.
- Identify the number of days they have been owners during the fiscal year to be declared, in case they have not been owners during the whole year.
Once the form has been filed with the Tax Authorities, the manager will send us the return filed, which must be attached to the incident, and this will conclude the incident.
Individual certificates will not be issued to each owner, the information is already available in Hacienda for “residents” will appear directly to the owner in his next income tax return, likewise for the “non-resident” the information will appear as “non-resident income”.