Certificates of tax residence and double taxation agreements — The Supreme Court consolidates doctrine and sets limits on the Spanish tax authorities

Background

In its ruling of 15 July 2025 (rec. 4023/2023), the Supreme Court (SC) reaffirms the doctrine initiated in 2023 (see our commentary at the following link) in which it established that Spanish administrative and judicial bodies are not competent to judge the circumstances of issuance or to disregard the content of a tax residence certificate issued by another contracting state when the certificate is issued for the purposes of double taxation agreements (DTAs). On this basis, if criteria for residence in Spain are also met, the conflict is resolved by the rules set out in Article 4.2 of the DTA, known as "tie-breaker rules" (permanent home, centre of vital interests, etc.).

Conclusions of the Supreme Court

In this new ruling, the High Court is categorical in stating that if there is a certificate of residence that proves a key fact for establishing tax residence in a given country, the Administration cannot ignore it or replace it with mere indications or suspicions. This certificate must be taken into account in accordance with the DTAs. Consequently, the criterion of the 2023 ruling is confirmed: the conflict of residence is resolved by applying the tiebreaker rules of Article 4.2 of the DTA.

However, the SC adds a very relevant reflection on the legal background of these certificates: there is a regulatory gap regarding the form, content and probative value of certificates in the conventional sphere. The DTAs do not specify who should issue them, what exactly they should include or under what criteria resident status is verified. This call for attention invites the articulation of clearer standards on the competent authority and the minimum content of the certificate.

Practical approach

In operational terms, the ruling reinforces the value of the certificate "for the purposes of the DTA" covering the period in question and requires careful preparation for the management of possible dual residences: it is advisable to document the tie-breaking elements (permanent residence, centre of vital interests, habitual residence and nationality), to anticipate the use of the mutual agreement procedure if necessary, and to avoid confusing proof of residence with obtaining a tax benefit. 

If the Spanish administration disagrees with the application of the other state's regulations, the appropriate course of action is not to deny the taxpayer a certificate of residence in an individual proceeding, but to activate the mechanisms for cooperation between authorities (e.g., exchange of information or, where appropriate, mutual agreement procedure). What does not seem compatible with the DTA is to replace the certification of the competent foreign authority with a unilateral interpretation by the Spanish administration.

Commentary by Osborne Clarke

The SC's message is clear: the certificate of residence for the purposes of DTAs cannot be treated as a mere dispensable indication; it is the key that opens the conventional channel and shifts the debate towards the tiebreaker rules provided for in DTAs and, where appropriate, to mutual agreement between authorities. This ruling is good news for the sector, and we can expect adjustments in administrative doctrine and greater rigour in how these certificates are issued, what information they include and how they are stored.

To gain certainty, it would be useful to have a minimum guide on the format and the issuing authority, without altering the distribution of powers under the DTA. In the meantime, the best practice is twofold: to request certificates expressly "for the purposes of the Convention" and to prepare, from the outset, a solid tie-breaker file.

However, the above should not be confused with the Spanish tax authorities' continuing ability to question certain tax residence certificates if the factual requirements of the applicable DTA are not met.