Lynn R

When speaking of Spanish tax allowances, why does nobody ever mention the low income allowance - which means that anyone earning €13,115 or less pays no income tax at all and those earning up to €16,825 benefit from some of the additional allowance until it tapers away altogether above that level of earnings? This relates to pensions as well as wages and both my husband and I have benefited from it since it was introduced.

"- Los contribuyentes con rentas inferiores a 16.825 euros se beneficiarán de una reducción de su cuota.

Según los Presupuestos de 2018, esta reducción asciende a 5.565 euros anuales para quienes ingresan menos de 13.115 euros y una cantidad proporcional a esta cifra para quienes ganan entre 13.115 y 16.825 euros, si bien en este ejercicio la reducción solo tiene efecto a partir del 5 de julio de 2018, por lo que la cantidad final se verá reducida en función de una serie de ajustes."

As well as Council Tax being far lower than in the UK, some other expenses working people have to pay are also far lower. Renters, unlike in the UK, would not be having to pay Council Tax in addition to their rent. In another example, there are posters outside the primary school near where I live, advertising after school child care at a local play centre. For care every weekday between 3.30 pm and 8.00 pm, the cost is €45 per MONTH per child.

Lynn R

Vox, by the way, want to make the "mileuristas" pay income tax again but reduce the maximum rate of income tax to 30%, benefiting higher earners. If I could vote I wouldn't be voting for them.

https://www.elespanol.com/espana/pol...0462021_0.html

Moses2013

All well and good, though I would think earning €13,115 or less is nothing to mention. How would you support a family and unless you own property outright (a lot of young people don't), rents are quite high in areas where there is work too.

Lynn R

Can a single earner on National Minimum Wage in the UK(and the Spanish NMW is now €1,000 per month with 14 payments annually) support a family and own or rent a property on that one income? I doubt it. Both parents normally have to work and it is equally hard for a single person on low wages to be able to afford a property, many in areas where work is plentiful have to share, just as they do here.

I live in a block of flats (working class Spanish area) where all the other occupants are Spanish. Take the example of one family living below me, a couple in their late 30s/early 40s with one daughter aged six. The father has a job, don't know what he does but he doesn't go to work in office clothes so not likely to be highly paid. The mother does not work. Their daughter is always beautifully dressed (and children's clothes are not cheap in Spain) and goes to an Academia two evenings a week for private lessons after school. Don't know if they own or rent their apartment, but either way they are paying for it, and they have a car. They wouldn't be getting any in-work benefits to help either, because they don't exist here. But not struggling, even on only one income. I know of many families in similar situations whose children go to the local concertado school, there would not be many working class children in private schools in the UK.

Fred James

The other thing that rarely gets mentioned is the taxation of annuities. They are very generously taxed in Spain as only a small percentage of the income is taxed , typically 25%. That means that if your pension was solely from an annuity, you could earn over 40k and pay no tax.

Barriej

Cant comment on the family earnings in the Uk.
But my son works for a major Uk retailer (marks and something) backstage as they call it (warehouse when I were a lad) in one of the flagship stores in West Sussex.
He does 31 hours a week (spread over 3 nights at the weekend, because of staffing levels they can't offer any more hours to anyone) and his wages don't cover his outgoings, we are still contributing to allow him to live. He can't apply for any in work benefit because with his out of hours pay he earns too much per hour but due to restricted hours he can't earn more. Lots of companies are now starting to do this in the UK.

Rent on a bedsit in Shoreham-by-sea is £650 a month (and this is cheap only because we know the landlord). House or room share worked out at around £450 a month but working nights he didn't want that.
His council tax is £140 a month he has electric only and thats another £85 a month. He walks or cycles to work (3 miles). After these 3 outgoings he has less than £100 a month for everything else he needs.
Ok he pays little or no tax, but does some NI and of course pension contributions.
When he moved in, we gave him all his furniture and white goods as we moved here a couple of weeks later, otherwise there was no way he could afford them.

He mentioned to us the other day that he would be better off if he was not working as the bloke who lives upstairs is long term unemployed (as in never had a job since leaving school, he is 3 years older than my son), but smokes and goes to the pub most nights, has a car etc.

We are living on a third of the money I used to earn in the Uk in 2020, but we had rent to pay, where as here we own the flat (we sold up when we moved in 2015 from Northampton to the coast but couldnt afford to buy there).


As to getting back on track.

Nothing really irks me about living here, we had been regular visitors to the area at different times of the year, so we knew what to expect.

I think mostly people complain because they expect Spain to be the same as where they came from, or didn't research properly before moving.
I stopped watching the programs about people wanting to move country as, in most cases these people had never even been there on holiday.
We get people on here (less now thanks to Brexit, suppose thats one benefit then) asking silly questions about moving here.

Or more likely they just wont adapt to the different environment that they are now in.

I don't know if we will stay here forever but while Im here I wont complain about the furniture moving, doors slamming and kids screaming at all hours.
I like to listen to music, which my neighbours must like, as they bang on the walls when Im playing my records.
I also work on my car and according to the wife, it can be heard 3 floors up when I rev it after making adjustments..
So Im as bad as the donkeys over the road and the dogs and parrot one of our neighbours have...

SanNico

It's a capitalist way of doing things to make money flow, not a communist way. It's an allowance of 26.67 per day if you're away from your normal place of work, which is usually home. So the worker reduces their taxable income by 26.67. The restaurant gets the full 26.67 of which 10% IVA goes to the treasury (in theory) and the rest goes to the restaurant owner who pays his overheads and tax on the rest. Otherwise the worker will just bring sandwiches from home and put more people on the dole. Exactly the same as it works in the UK, just with different values.

Economics lesson over. The overall tax level in Spain is very good. The quality of living due to disposable income of even those on low salaries is visibly better, see above comments regarding eating out, clothing, extra curricular activities etc.. I have friends in the UK on similar salaries who struggle, despite their mortgages being much lower than my rent. It's the stealth taxes and general cost of living that cripple them.

Ronnyone

Spanish families survive on a different economic system than uk. Whole families often club together ( joint properties etc). The grandparents often cook large meals for everyone and it is not uncommon for two generations to live together. Even married couples often live with parents. I have new neighbours- single mum, two kids, 2 grandparents all in a small 2 bed 50 metre apartment!!. No idea how it works but they seem to come and go during the whole day- then disappearing for days on end. Its weird ( and noisy!) On the subject of wages. I have never met anyone in Torrevieja on a wage of more than 1.500 euros. My ex has just left her 4th job this year as they technically fired her so they could rehire her in a different part of the company covering someone's maternity leave which isnt actually being used as she is still working but cash in hand etc etc,. The fact that she works as a tax advisor yet gets less than 1.000 euros a month is a joke. A fruit picker gets 1.000 and month as does an unemployed family. I am struggling to support myself and family now as the cost of living is rocketing. Honestly I'm fed up of essentially rich expats saying Spain is cheap and how they have a better way of life. It's cheap because your lawyer pays his staff bugger all, office workers are exploited to keep prices low to attract foreigners to buy properties.

Lynn R

I am glad to see Mercadona have increased the salaries of their employees by 6.5% this year, putting a full time shop worker in their first year of service on a gross salary of €1,452 per month (14 payments per year).

https://www.eleconomista.es/retail/n...en-Espana.html

Lynn R

No Spanish families in the 40 apartments which make up my community live in multi-generation households (although quite a few did in the barrio where we used to live in an old townhouse). The couple next door but one to me (he works as a salesman for a company supplying foodstuffs to restaurants and bars, so will not be highly paid and she does not work) have just moved her mother into the ático next door to me which became vacant after the last tenants moved out - although they have a spare bedroom so she could have lived with them if they were struggling financially. No doubt her pension pays the rent for her own apartment.

Up until a couple of years ago that ático was rented by a young single man who had a job in a furniture shop in Málaga, so again would not have been earning a fantastic salary. Being able to afford a 2 bedroom ático as a single earner is quite a contrast to the scenario described by Barriej (thank you for the honest comments Barrie) above whose son needs some financial support from family to enable him to live in a bedsit although he is working. Since that tenant left we have had 2 young female nurses living next door for a while, followed by 2 instructors from a nearby flight training school.

Lynn R

And they make it work for them. The best example I ever came across was a gitano family who lived a few doors away from me in my old barrio. They were a late middle aged family with 7 children, the eldest two had left home but the 5 younger ones were still living with them. The father worked as a street sweeper for the Ayuntamiento (well, the company set up to provide cleaning services when they were privatised). He earned €1,100 a month at that time, 14 payments a year of course, and that was more than 10 years ago when he told us that. I remember being quite surprised by that and thinking blimey, that's more than we have to live on for a month - which it was, then. His oldest daughter and youngest son also got jobs as street sweepers, and two of the other sons were working as refuse collectors for the Council cleaning service at night, so there would have been an awful lot of money going into that house every month. Another son is disabled so would have been receiving benefits.

First they renovated the parents' house to within an inch of its life, doing all the work themselves. Then the two refuse collector sons, in turn, each bought a very cheap house nearby (one had been badly damaged in a gas explosion). Again they, with help from family and friends, working during the day before they went to their paid jobs at night, renovated those houses then moved into them with their partners and both now have families of their own. A third house was bought and renovated for their sister to move into. The only child left at home now is the disabled son, although the parents get a lot of support from the other children (the father retired a few years ago and the mother now has mobility problems).

They were great neighbours to have and helped us out with quite a few things, as we did them as they often came to borrow tools from my husband.

bobd22

Not everyone who comes to live in Spain or elsewhere are rich expats I certainly aren't and never refer to myself as an expat anyway. I am not rich or even near it, I have a reasonable pension plus state pension,my wife has no income whatsoever currently due to UK pension age changes and lives of moderate savings. I would say we have a better life here in Spain than we did in the UK. How's that by planning and preparing for it we bought a very modest village house here outright don't live beyond what we cant afford in cash. Very different of course if one requires to work here in Spain. Many of us though worked many years in UK saving and planning for our eventual retirement even with spanners in the works like brexit thrown in, we made it work. Horses for courses we shouldn't all be tarred with the same brush in my view.

Barriej

Totally agree. We consider ourselves migrants. We packed our belongings on a van and migrated.. Simple if you ask me.
And if you look at the past when you only needed something like €600 a month, you could have come here quite legally with just a UK OAP.
Even when we came over just before Brexit. Alicante wanted €9000 each plus regular outgoings plus medical insurance, easily attainable by most people.
Especially if they had sold up in the UK as average house prices are now well over £150,000 if your mortgage is paid up.
In fact the vast majority we know here are normal pensioners, there are the odd ex civil service with huge taxpayer donated pensions but we don't tend to travel in the same circles as them so its not a worry (for them I don't care)

Im not yet 60 so I will have to wait 7 more years for my OAP, we only retired early because it was less hassle (but will in the end cost me more) than complying with the terms of the NLV.
I took the 25% out of my private pension and we had some savings and I draw on that pension (which at current rates will leave me with no income in 9 years) but we will both have our OAP's by then.
The wife has no income or pension, we cashed that in to help finance the flat.
In fact if we hadn't moved, I doubt we would have now. I would have continued working and bumped my pension up and when I finally retired we might have gone off to Australia or the Caribbean.
We could have afforded it by then. Spain would just be somewhere we visited for a couple of months a year.

Lynn R

When we moved in 2006 we didn't have to prove any income level at all, just have health cover - which was covered by the residual S1 form that the UK was still issuing at that time based on our NI contribution record, which covered us for the first two years after which we had to take out private cover. So we were able to come just with the proceeds of the sale of our house (a terraced house in Lancashire so not very much money at all) and a small inheritance my husband had from his father. We gave up our jobs (me aged 50 and my husband aged 57) and didn't get any kind of early retirement deals, we had to eke out the money we had until our various pensions became payable. The last one of mine, as I said earlier, will just start being paid later this year, 16 years later. That, I think, gave us a pretty good understanding of whether it's possible to live in Spain on a low income - and a low income is a low income, whether it comes from UK savings/pensions or is paid to a Spanish worker, things cost the same for all of us. We could not possibly have given up work and lived in the UK on the same amount of money we had to manage on in Spain (in our first year, I remember our living expenses came to 7k sterling in total, and although we could have been quite a lot better off had we continued working until our state pension ages, there is no way I would swap the last 16 years of freedom from the rat race for the extra money. And that is in spite of the global financial crash having happened very soon after we arrived after which the exchange rate plummeted and so did interest rates on the capital we had to draw down to live on - from the 5.5% we were getting at the time we moved to practically nothing.

Lynn R

Another indication of the fact that (apart from the poorest and most marginalised in society) Spanish workers have a higher standard of living is that 23% of them now have private health insurance - the figure for the UK is 11% so although people are paid a lot more there, fewer of them can afford some of the things the Spanish can. And a higher proportion of Spanish workers can pay for these things despite being burdened by excessively high taxes - or so some people try to tell us.

https://www.infolibre.es/politica/se...1_1195792.html

The rate of home ownership in Spain (latest figures available) is also higher at 75.1% compared to 64.5% in the UK, although it has been falling slowly in both countries in recent years.