rbs_gb

Good morning all

Quick personal intro as I've just joined the forum, I'm retiring to Cantabria soon and doing the NLV application for residence purposes. I've a number of up to date tips to offer based on my experience and will try to input those on the various threads about NLVs. I'm a fluent Spanish speaker with over 40 years experience of the country, and the current UK/Schengen rules are too restrictive for what I want for my future, hence the plan to move to Cantabria.

Which brings me to my question. does anyone have any recommendations for a gestor/tax adviser in Cantabria? I will definitely be paying more tax in the Spanish system, and although I can find any number of Gestores in the area, finding one with UK tax experience isn't so easy! I can think of a number of potential ways to save tax by careful timing and putting funds in the right place, but could definitely use some expert advice.

Many thanks
Ray

Casa Santo Estevo

welcome to the forum.

I think there is only one member that lives in that part of the world.
If they do not post anything you can do a search on the official Colegios de Gestores
Buscador
I do not think they need to know about the British tax system. You "earn" money in The UK, some of the UK tax exemptions come under The double taxation convention. This is obviously understood by those who practice in fiscal matters.
If you pay tax in the UK on any "earnings" these will be included in your Spanish tax return, which will be at the rate after UK tax deductions.
Technically whilst there are no border controls within the Schengen zone you cannot technically leave the country you have a residence visa for. All so called Freedom of Movement has been lost for the British. I have not read otherwise. I hope that someone here can give you other information hopefully with a link to prove that incorrect.

Barriej

Depends what 'earnings' you will have in the Uk after you become resident. But as a resident in Spain you will be expected to pay Spanish tax...

If you only have a pension (and you have converted everything to cash) then you can get a zero tax code from the Uk and you will only pay here. You get this once you have made your first return here in Spain (you have to legally file here its not an option)
If you keep a uk property and rent it out then you will continue to pay Uk tax...

rbs_gb

Thanks to you and Barriej for that info, maybe I should have chosen "SegundoEnCantabria" as my nickname

I'm fairly up to speed with how the Spanish tax system works, and I don't need an English speaking gestor, but I do have a tax plan that I want to get a professional opinion on. I'll explain it here and would welcome any comments:

I'm expecting only to pay tax in Spain, and my income streams are UK State Pension equal to 12000 euros, a private pension fund with the pru which I don't plan any drawdown while living in Spain, and interest on UK savings in fixed rate bonds/ISAs (which I know are not taxt free) of about 7000 euros, so lets say that is 19000 euros as income. Obviously that is over the new limit of 15000 euros which would be allowed tax free.

So, plan A would be to use something like the NSI green bond, which pays 4.2% on a maximum investment of 100k sterling over three years. The important part is that annual interest is not available until bond maturity after three years and there is no early withdrawal allowed.

So the income year 1 is zero, year 2 is zero and year 3 would be approx 12600 sterling (plus compounding). Now, so long as Hacienda accepts that to be true, my "income" for the first two years would be below the magic 15000 euros tax threshold and I would live tax free without even needing to do a tax return. As the interest wouldn't be paid until 2026, I wouldn't pay tax on any of it until 2027 for tax year 2026. The technicality is that no interest is paid on the bond until 2026, even though it is quoted at an annual rate of interest. Hence my need for someone with a sound understanding of UK savings and investments before I move the funds into the three year bond. If Hacienda considers the bond is something that tax is only due on the final gain, it is a different situation to if it is treated as annual income.

Hope that makes sense.and thanks again for the input.
Ray

Moses2013

No idea but even the best tax experts can get caught out in Spain. You would also need to consider exchange rates and all I know is that it's far too complicated for me and just glad I earn € and spend €.
I don't see why your tax expert should be based in Cantabria and you might be better of contacting offices in Madrid, Barcelona etc.

rbs_gb

Totally agree, so much of any tax system is down to interpretation and who deals with your case. I would have preferred to use someone local for tax advice as I prefer to deal face to face. You're right that there is definitely more experience in other parts of Spain so I might have to go down that route. There isn't a problem finding a tax expert here, but those I've spoken to using the above example were honest enough to say they don't know how these bonds would be treated.

Moses2013

I can understand that face to face is preferred and no doubt there will be good advisors in Cantabria, you'll just probably have better chances finding international services in the major cities.
I'm not a full time resident and only have a holiday home in Girona province, but I've always found everything I needed in Barcelona and worked well with video calls (Lawyer, architect).

Barriej

It makes sense but its not you who decides if you need to file a return.
Even if you only earn €100 a year, its still considered earnings and someone has paid you so it needs declaring...
Im assuming by the figures you quote there will be more than €50,000 in the three year bond.
This may need declaring on a modelo 720. Which is a reporting tool and I bet if you dont file a tax return they may be questions..
Also if you are coming here on the NLV it will be assumed that you will have €24k plus in earnings anyway as you have to show this for the visa.
Or if you didnt it would be nice to say what the consulates are actually accepting.

We filed both a 720 and a tax return last year but our complete earnings were less than €12,000.
I will file again this year as my private pension is now higher and I won on the premium bonds, but this will still be lower than €15,000 for the two of us.
I converted almost all of our stuff into ready cash as to be honest I want to spend without paying too much tax.
Not bothered about high interest as I have just enough to see me to about my early 70's but by that time me n the wife will have our OAP's so it dont matter if there is nothing else left.

For the pain of about €100 a year I would rather file a zero return and know that I may not be investigated (this happens alot) at the end of the fouth year.
Also filing a tax return is a way of proving your residence should you ever be asked.

Also be aware that you may also have to pay tax on the total of the three year bond as well when you convert it to cash as its not a standard savings account here...
I dont think you will be saving yourself anything by only reporting the interest at year three either, if the interest is added yearly then you will be expected to declare it.
Just because the bond doesn't mature for three years, you will still have earned the interest in each year. You wont pay twice or three times on that interest.

And in fact you may pay less by declaring it annually as you may go into the next tax bracket when you declare the full amount at three years. Have you considered this?

ALL interest is considered as income.. As i said we have 'won' money from premium bonds this is taxable, the money in the bonds are not, as there is no equivalent here and they are (well according to our accountant) cash savings.

rbs_gb

Hi Barriej. Lots of good points there and I would certainly agree with you that compliance is "strongly advised" in all things tax related. The document I'm working to is this one:

https://sede.agenciatributaria.gob.e...ino-unido.html

It is slightly out of date as the level of 14000 euros has been raised to 15000 earlier this month. The option is there for anyone who has income below the 15000 threshold to not present an IRPF declaration, but I agree with you that it probably is better to present it

Everyone has their own view of tax and savings. Even if I end up being taxed on the interest at 24%, I'd rather pay the tax and have 76% of the interest as additional income, rather than just have it in cash.
Cheers
Ray

rbs_gb

The current IPREM for 2023 is set at 600 euros per month, so that is either 7200 or 8400 per annum depending on whether you work to 12 payments or 14 payments. 400% of IPREM therefore is either 28800 or 33600 euros depending on which you choose.

In my case, the standard maximum state pension income has been accepted at 12000 euros equivalent for the NLV. The balance between this income and the IPREM threshold can be any combination of savings or additional income, and in my case they have accepted the value of my private pension fund as "being able" to meet the IPREM requirement without taking any of it as drawdown. You don't actually need to have it as pure income.

Ray