scot66

I completely agree that the 6 and 6 doesn't suit everyone. I want to feel at home and want to throw everything into a life in Spain. I admire people who manage the half and half because it seems so much hassle that I don't think I have the personality to handle it. I will pay all my taxes etc, just frustrated at the CGT thing. As you say, spitting my dummy out won't make any difference.

Dondurma

I have discussed thus at length with 3 different accountants in Spain who have years of experience

They all told me categorically the law states if you become tax res the same year as you sell your U.K.house you are liable for CGT in Spain on the UK house

I should point out also that 2 of the 3 also told me despite their bringing this to their clients attention not a single one of their UK clients had opted to tell the Spanish authorities about their UK sale nor had any bother for not doing so

You takes your choice......

Horlics

But if you sell a house and it is at the time your only residence, then you don't pay CGT, anywhere?

scot66

Horlicks, that would be great if it is true because it is our only residence. I suppose that's why I am frustrated, I wouldn't pay CGT in the UK if I sold up and then moved into a rental so it seems strange that I should be paying it when moving to Spain. Now I am more confused.

Dondurma

The exemption in the U.K. for it being your only home does not apply in Spain
If you sell it in U.K. in the same year you become tax resident in Spain you are liable for CGT in Spain

If however your new house in Spain costs you the same or more than the entire sale price ( not gain- entire sale price)of your UK home you can offset and pay no tax

Fred James

That's almost correct and it doesn't just have to be in Spain. The normal exemption is that if you have owned your permanent residence for 3 years and you sell it and reinvest (all) the proceeds in a new permanent residence, there is no tax due. If you only reinvest a part of the proceeds, then the tax is calculated pro-rata.

This equally applies if you sell your Spanish residence and buy a new home in the UK and equally the other way round.

Horlics

I'm not sure I would just suck it up then, if all it takes to avoid is to delay residency until the year following sale.

That tax will pay for a nice long holiday somewhere. I'd rather enjoy it that way than hand it over.

scot66

If I have understood all of the advice correctly then one poster has said that if I go after 1 July and sell before Dec then I would not be liable. Another poster said this was not correct , it doesn't matter when I go I will be liable. I think the issue is if you know that you intend to stay permanently then you are considered a resident from day 1. So I will go over after 1 July for a 6 month trial period then , if I intend to stay, apply for residency.

Rosemary

Fred James ensures that he keeps up with changes in the law constantly and is very knowledgeable.

Rosemary

bobd22

Scott that was my comment you have 183 days per calendar year from 1 Jan. So 1 July to 31 Dec would not make you tax resident, you would then have untill 30 June in following year before becoming tax resident. However as Fred rightly pointed out once you become tax resident then you are liable for tax for the whole of that year from January. However it still stands that if you moved to Spain after 1 July and sold your UK property before the 31 Dec then you would not be deemed Spanish Tax Resident so would not be liable for CGT in Spain for that year.

scot66

Thanks to everyone for the advice, very much appreciated as googling comes up with all sorts!

ned flanders

Whose calendar are you using? July 31 days, August 31, September 30, October 31, November 30, December 31, TOTAL = 184 days = Tax Resident.

Dondurma

Yes I have always used 4th July as the marker point-easy to remember ( US Independence) and gives you the little bit of leeway

Obviously any visits to Spain earlier in the year push that date back