davethedog

Thanks all and been looking into the medical insurance and all seem about the same cost in reality.

Joppa

You only need private insurance for a year, and then you can join the state health scheme under Convenio Especial if you aren't working or self-employed. Cheap at around 60 euro/month and covers pre-existing conditions but not prescriptions.

davethedog

Is that per person? As the quotes we are getting for private med cover is about that per person.

Joppa

It is per head, but since it covers pre-existing condition, which no private policy does, it's a very good deal.

m2m2012

I could be wrong but my understanding is that the 60% relief does currently apply to rentals outside of the EU (such as USA, Canada and Australia) . Can someone confirm?

bob_day

Something else to bear in mind is that once you become Spanish resident should you decide to sell your UK home you will possibly be liable for an unbelievably huge bill for capital gains tax.

We briefly toyed with the idea of disposing of our uk house recently. We have owned the house since the early 90s and i guess it would sell for £475k or thereabouts. I would be expected to hand the Spanish government around 70,000 euros in cgt.

What strikes me as even more ridiculous is that if we give the house to our kids we are still liable for the same cgt bill.

davethedog

Yes, aware ot that and we would return to the UK at some stage anyway and denounce the Spanish residency before we even thought of selling the house!

bobd22

Something we have considered, I presume the cgt you refer to in that instance would be because you have been renting out the property ? My understanding is if it's your main residence (ours still is as wife currently living in it) then there is no cgt if gifted but 7 year rule applies re inheritance tax, or am I missing something? Sorry just re read your comment I thought you referred to UK cgt. I was told in Spain if we gifted UK house to UK resident kids that Spanish cgt wouldn't apply as it would fall under UK tax rules?

bob_day

Not because we are renting it out, the income from which is declated annually on both UK and Spanish tax returns. It is because it isn't our primary residence and thetefore considred an asset. The UK cgt tax Iability would be considerably less, due to allowences and deductions and the fact that they calculate monetery gain from 2015. I did a quick calculation of the tax due in the UK and i reckon it would be around £6k. This would need to be paid to HM Gov, but would be offset against spanish tax due to tje dual taxation agreement.

Whole different ballgame if it is your primary residence.

Should add i didn't look into this in minute detail, just sufficient to decide that there was no way i was paying the spanish gov that ridiculous amount of money because i bought a house to live in 25 years before we moved to Spain . You can offset selling expenses, and there is a (small) allowence if the house was purchased before 31st December 1994. But you still end up with a huge bill.

The only obvious way is to move back into it for 6 months so it becomes primary residence again. But presumably you have to renounce spanish residency for the duration and who knows how tricky that will be to reinstate once the house is sold.

Can't even give it away🤣

Joppa

Any part of your capital gains on UK house sale will be taken off your Spanish IHT bill if you invest in your principal residence in Spain within 2 years.

bobd22

Cheers yes thats my understanding also but in our case as my wife is currently living in it then until she can retire it is a primary residence. Of course not sure how that works with me being here and resident to ensure our rights under brexit. Nothing is easy.

bob_day

Not planning to spend that amount of money on our current principal residence as there's bothing that I need to build onto it.. However I wonder if I could say purchase an apartment on the coast and offset my CGT against that, assuming that we lived in it for more than half a year and it becomes my principal residence...

We have found new tenants and they go in early June so panic over for now. Status quo has be restored.. :-)

Mustard

Just done my Renta. When asking for location of property the only options you are offered are España, Navarra, Pais Vasco or En el extranjero. Which would indicate that relief applies to every country.