GillianF

Hello Everyone, we are buying a house in Blanca and due to move over in September. I have been doing endless hours of 'research' and my head is about to explode with 'must remember' facts and information!
My question (first of many!) involves my Husband's pension, he is retiring from the Army. Does this count as a Government Pension and therefore taxable in England? If yes, and we don't have any other income, do we need to fill in a tax return in Spain next year? Sorry if this a question which has been asked and answered a thousand times before! Thank you in anticipation of replies.

Fred James

If that is your only income then you don't need to fill in a declaration. It is a government pension and will be taxed only in the UK.

However there are some significant advantages if you can claim to be tax resident with regard to CGT and IHT which you may have cause to appreciate in the future.

It won't do any harm to make a zero declaration from day one but it is not a legal requirement if you have no other income.

GillianF

Thank you for clarifying that it is a Government pension and your advice on a zero declaration. It will be a steep learning curve for the first year or two!

Mitzyboy

Judging by the time of year you are moving over, you probably wont need to make a declaration until 14 months after. We moved in October and didnt make one covering the following year until the beginning of the year after

Also if you eventually have a state pension, the tax burden on that can be moved over to Spain, so that you can take advantage of two tax allowances, one here, one in the UK for your govt pension

pwwm

Welcome to the forum, hope you enjoy as much as I do

cymruambyth

Welcome Gillian, I retired from the Army in 2009 and moved to Costa Blanca (but now live inland Las Alpujarras). A decision you will need to make is how to have his pension paid? either all to the UK or all to Spain? MOD will not split it. Personally I have mine paid into my UK bank and then send over a set amount each month through Currencies Direct - it works for us (others might disagree). I have now submitted 3 years tax returns (with zero to pay).

If your husband is retiring soon, then no doubt you are pretty busy going through the resettlement processes at the moment. If you need any help/advice on a military perspective of retiring to Spain feel free to drop me a pm.

GillianF

Thank you for the welcoming replies, advice and offer of help on military issues. I was quite intimidated by the depth of knowledge on here and how little we actually know compared to how much we have to learn! Hopefully it will be a little less painful if I can ask questions and make friends on here.

sujee

We moved out in February this year and the advice and help form members of the forum has been invaluable. Your right that it is a steep learning curve but somehow once your here things do fall into place.
My best advice is engage a good gestor to deal with all the paperwork you will need to complete on arrival. They will also be able to give you accurate information on legal issues.

I have both my state pension and teacher pension paid directly to Spanish bank and they cover our living expenses and utilities and even allow for a few luxuries. OH has his current salary and teacher pension paid in UK. We won't have to complete a tax return here until next year.

Good luck with your move and if i can help in any way, just ask.

GillianF

Once again thank you for the words of encouragement.
I think the 'good' part of 'good gestor' is what is giving me the largest headache!
Does anyone live near Blanca in the Ricote Valley who could recommend one? I presume ( a dangerous thing I know!) that it is better to live close by rather than a distance to the gestor.

sujee

I'm afraid I live too far away from your area to be of use in recommending a gestor but one that is based close to where you will live is best. We were fortunate enough to have one who is native speaking English but brought up in Spain, which is helpful if you are not fluent yourself. Hopefully someone closer to you can suggest one.

EsuriJohn

Sujee we are just like you my wife has a teachers pension and I have a civil service pension (Government Pensions GP) and we both receive our retirement pensions (State Pensions SP)

In this situation you cannot export your GP un-taxed from UK but you can export your SP un-taxed from UK. We do exactly that and the benefit is that we each get two personal allowances to set against our pensions in each country. This means that we pay no tax on our SP's in Spain and the tax on our GP's is reduced by SPx20p in UK for me that comes to 7000x20p or £1400. Similar for Kath. Worth having in my book.

Something we have found by experience is that the direct transfer by DWP of the SP's to our Spanish accounts is at a cracking exchange rate and arrive like clockwork every 4 weeks. Last month they exchanged at 1.2450 will find out tomorrow what we will get this month.

Less happy about Capita who subcontract the transfer and exchange rate, was Bank of New York. We tried it and went back to paying into UK account
and managing the exchange and transfer ourselves. Overall I think we have done better on the exchange rate and we don't pay the transfer fee that Capita charge.

sujee

Thanks for that info on GP, I will have to leave mine to suffer the tribulations of Capita for a while as I don't have a bank account in UK anymore and they won't pay it into hubby's account. When I next go back I just have to pop into the branch and add my signature to make it joint.

EsuriJohn

Good thinking simples! SP came through about lunchtime yesterday (clockwork). 1:1.2356 exchange rate which was about interbank high on Monday not bad.

flotsum

I live in Cieza we used a gestor to re matriculate an english car and to change addresses and ownership on our spanish car, we did not use a gestor for anything else. We are lucky in that my sister in law speaks fluent spanish and she phoned around the local gestors until she found one that had completed this service before and sounded confident in doing this. I would think that in Blanca there must be a gestor that has helped people before as there are quite a few english living there. We have an assessoria for our tax returns but as they are complicated no one in Cieza wanted to get involved and we have had to use someone on the coast, makes a nice day out! There was an English speaking tax lawyer in Fortuna who gives the first consultation for free, but after that he was very expensive that was 3 years ago I don't know if he is still around.

GillianF

Thank you for the information, we have friends in Fortuna so hopefully they could help.
When we went to view the property the Estate Agent said he thought the house behind ours was owned by an English couple. We hoped there would be a few British families as we are moving with our youngest son who is 11 and will be attending the local school.
Have you lived in the area for long? I have looked up all the local towns/ villages but all the information seems to have merged into one huge mass! Hopefully we will have plenty of time to discover it all at our leisure very soon.