Jenny22

Hello everyone, this is my first post on this part of the forum. I have searched this forum for answers to my questions, but haven't found anything quite fitting them.

A few years ago, me and my husband bought a small house in Spain in joint names and used it as a holiday home for us and our family. Between us all we spend three or four months here each year. We are actually here at the moment. As joint house owners we are both registered on the Padrón and pay IBI, Non resident tax and utilities bills accordingly.

But now my husband has retired and wants to move here permanently and become a resident (or at least sign on the Oficina de Extranjeros as living in Spain). He will also need to become a tax resident here. This would save us a fair bit in the extra payments we have at the moment from owning a holiday home. He wants to do everything correctly so that as a pensioner he can sign on at a health centre and get free health care. I understand that this will mean losing his rights to non-emergency health care in the UK.

As we will need to do some renovations on our house in Spain and already have the license for this, my husband wants to sell our UK house to fund this and we already have an offer. The UK house is heavily mortgaged so most of the little money left over will be used to pay for the reforms on our Spanish house.

All well and good. We are struggling already to pay our very high UK mortgage especially since my husband retired and there is scant hope of us selling our Spanish house, so, despite the fact we will soon own no property in the UK, selling our UK home has to be our best option. We both speak Spanish (not fantastic, but enough to talk to the neighbours and manage in most situations). We have already made friends here, we like the culture here, we know many of the pitfalls to living here, we own our home here, and my husband feels assured that we will be okay.

The problem is that I have a permanent, reasonably well-paid job in the UK which cannot be transferred to Spain. We could not live a comfortable life in Spain without my income and I know it would be almost impossible for me to find work here, given the high unemployment levels. I also have close friends and family I do not wish to leave permanently. I know they could visit us here and I could visit them, but without my income regular visits to the UK would not be possible.

At the moment my husband is suggesting that out of the funds left over on our house sale, after renovation costs there will be enough for a deposit on a UK flat. The idea is that I live in the UK and work there, taking frequent trips to visit him in Spain until I reach pension age and do not need the wages. And if worse comes to worse at least we will have rented accommodation to return to. This will mean that I retain my health care rights in the UK, continue paying in for my pension and although as a Spanish house owner will still be subject to Spanish taxes, my main payment of taxes (and NI) will be made in the UK.

But I can see problems with this. The main one is that I don't think I will ever be ready to make a permanent move to Spain as I have too many family ties here. I am also worried that this could turn into a bureaucratic nightmare. If my husband takes out the EU equivalent of residencia in Spain, I am thinking that if called on to prove I am still a UK resident, being part owner of a property in Spain with my name on the Padrón and with my husband a tax resident there, it may be difficult to do so. Then there is the subject of Inheritance Tax if something happens to one of us. that would be a total nightmare.

And then there is health cover. My husband refuses to take out private health insurance for either of us and for him it wont be necessary, but if I am spending more time in Spain visiting him even in short bursts, I am worried about being covered in Spain by only an emergency cover card.

There are more things I am worried about, but I wonder if I am worrying unnecessarily. And in any case that's plenty for now. Sorry that post was a bit long winded and thanks in advance to anyone who answers it.

Jenny

Rosemary

As Concierge for the Spanish section of BE I would like to say hello and welcome.

BE is a very large expat website, so if you have problems finding your way around we have concierges who will try to direct you. The moderators for the Spanish forums are Mitzyboy and Fred James, moderators are there to ensure that the site runs smoothly within the rules of BE. Problems and complaints should always be addressed to a moderador who will look into the matter and deal with it efficiently and fairly. Our members who post in the Spain Forums are friendly and helpful with a wealth of knowledge of the issues of living in Spain. At the top of the page you will find a quirkily named thread called Free Beer which is full of important and useful information. Hope you enjoy your time participating in the forums.

Please let me know if you need any further help.

Rosemary

lynnxa

wow - complicated

the first thing that jumps out at me is that if you aren't resident in Spain you should be on the padrón - I know that in the past people have been told by agents & so that they should be - but you shouldn't - so you need to un-empadronar yourself - both of you unless or until your husband decides to become resident

if you are living, working & paying tax & NI in the UK then you are resident there & entitled to full usage of the NHS & can use your EHIC for visits to Spain

if your husband is a pensioner resident in Spain he will get full use of the healthcare here & can use his spanish EHIC for visits to the UK

I don't know about the tax situation with one owner resident & the other not - but I hope I've helped a little

Lynn R

Jenny, I can't say that I have any personal experience of the scenario you describe, but here's my two-pennyworth anyway!

I don't think you would need to worry too much about health care as long as you didn't spend more than 90 days at a time in Spain as the EHIC should cover you for any emergency treatment that might be required during your visits. As you have a permanent, presumably full time job in the UK it is unlikely that you would be doing that anyway, I would think.

I also don't see any reason why you couldn't remove your name from the empadronamiento register whilst leaving your husband's on it as the person who would be residing in the Spanish house.

I don't know how the tax authorities would treat the question of non-resident taxes theoretically being due only from one of the joint owners of a house, but one of the forum members much more knowledgeable than I might know more.

As to the situation in principle of living apart from your husband for much of the year, really only the two of you could decide if that would be workable for you as a couple or not. I might be able to do it if I only had a couple of years to work until I reached retirement age, but not long term. Only a month after I moved here my father was taken seriously ill in the UK and I spent the next six months dividing my time between a few weeks spent being with him as much as possible in the hospital, and a few weeks back in Spain with my OH. I absolutely hated it, was never happy in either place as I always felt I should be in the place where I wasn't, if that makes any sense.

I know there are quite a lot of people who do commute to the UK for work, or work offshore, leaving their families in Spain, so it obviously does work out for some people.

Best of luck whatever you decide to do.

pwwm

As a pensioner the EHIC is now and has been for the last year given to us redidents is Spain from the UK, I have mine and OH is on the way, all your husband needs to do is ring them and say living in Spain (once registered here of course)the EHIC is now given by the country you receive your pension from.

Personally if you are showing the doubts you very obviously have I wouldnt move permenently, I know JK would move back like a shot if I said I wanted to go, and he loves it here. Think long and hard, it is sounding like you will be dreadfully homesick for the family. Now having said that I do get home sick but will you have the funds like we do to treat yourself to three or four short breaks to see them yearly? this is what I do and it works plus of course they come here.

I do hope you feel better about it, having a small flat kept in UK will help as you will still have somewhere to go.

Good luck and really do hope it works for you

spainrico

I don't see why the tax situation is complicated - husband becomes resident in Spain and so declares in Spain and has the local tax advantages, whilst you remain a UK tax payer until such time as you decide to make the move.
But of course you should take professional advice from both countries.

fionamw

We have this situation, and simply pay the smaller sum for my OH because I'm resident.

Indeed only you can decide.... the difficult bit is that it may take some time to realise the full implications. Phone calls. Skype. Not being up to date with day to day 'chit chat' and stuff like that. Telling each other problems or not because of not wanting to stress each other. Can you tell I have this problem? !!

Fred James

Yes but the husband cannot use it in Spain and it is only issued to UK pensioners.

In this situation the husband, as a resident pensioner, would have full Spanish health care. The wife, as a non resident would not but she would be covered under the UK issued EHIC.

As for tax, although Spanish tax law could decide that the wife was tax resident in Spain as her husband was resident, the double taxation treaty would almost certainly decree that she was UK tax resident as she was officially resident in the UK under the 183 day rule.

As for the implications of property ownership, half of the house would be considered hers and non resident taxes would be due on it. As has been pointed out, as a non resident she would not be entitled to be on the padron.

As for IHT she would be considered non resident and would not get the additional allowances that apply to residents. The same applies to CGT on the sale of the house if that should occur.

Jenny22

Thanks very much for your answers.

I thought we shouldn't be on the padrón as non residents, but were told we needed this to get our electricity upgraded (can't remember if we actually showed it though, but I do remember all the hassle and forms) and were also asked for this when we applied for our first building licence. I think it's a good idea if I take my name off the padrón very soon and my husband leaves his name on it as he has definitely decided to be a resident.

The subject of tax has made me wonder whether it is worth the hassle of being joint owner of the house at all, considering that I would have to pay IHT as a non resident whether I was joint owner of the property or not.

No I won't be spending 90 days here at any one time, but as my job enables me to take longer than normal breaks I will be here for a few weeks at a time, but I suppose many people do this using just an EHIC, so that's one worry off my list.

And I am already beginning to think about the implications of being apart from my husband most of the year, especially as this could go on for several years. fionamw, when you talk about 'Telling each other problems or not because of not wanting to stress each other' I think that's how we will be. He'll probably cope with it while I could end up a nervous wreck. But my husband sees no alternative. We have a house in Spain we will be very unlikely to sell but we own it outright. We have a house in the UK which we can't afford to keep and which is pushing us more and more into debt each month and which when sold will not leave us with enough money to purchase another one.

My answer is for us both to go into rented accommodation in the UK. To me it makes perfect sense as I will be renting anyway, but I do see my husband's point about living in a place we actually own, have worked hard on and are already paying bills for.

Maybe as the months go by one of us will come up with an alternative, or absence will make one of us change our mind. Who knows?

fionamw

I just had a brief re-look at the thread and realise nothing much if anything seems to have been made of the possibility of renting your Spanish property for holiday lets.
You mention you and the family use it for up to four months a year, which to me suggests (could be wrong!) that it's maybe somewhere people actually want to go on holiday.
If it is in sufficiently good repair at the moment to rent out, how about you selling your property in the UK, renting in the UK, maybe spending a small sum to get your Spanish house tourist-ready and put it for holiday rental. That way you have the freedom still to come and go to it while you both spend a bit more time - living together, of course - considering your wants and desires for the longer term. ??

HBG

Being on the padron in Spain is pretty meaningless under your circumstances, as is being the joint owner of what, for you, is a holiday home here. The tax situation has already been answered, as has the health issue.

The personal issues are for you alone, but on the overall picture I would suggest that you don't have to inform any authority in either country of anything; it will only complicate matters should things change in the future.

Jenny22

Thanks Fiona, renting the house is something we tried a few years ago but with not much success. Our house is in good repair and has all basic facilities, but we don't live in a tourist area or near a major airport and you need a car to go anywhere. We managed to let the place to friends but that was all. But I could get my husband to have a look at this again and find better ways of advertising the property. Nothing ventured nothing gained.

Jenny22

Thanks, but while that is true and it would be great to avoid complications, doing nothing would leave my husband unable to sign on for health care here surely?

lynnxa

the only thing to do is play it by the book - or you won't get access to what you need & are entitled to

if you don't live in Spain you don't go on the padrón or residents list & therefore remain as a UK resident with healthcare etc.- if your husband does, then he registers as resident & sign on the padrón - and as a UK pensioner gets healthcare here

the gestor/accountant sorts out the tax, which from what the others have said isn't so very complicated

Jenny22

Thanks Lynnxa. We are going to play it by the book.
We already know a gestor who helped us when we first bought our house and he's still in business. We found him to be a very competent guy and we're seeing him tomorrow. So fingers crossed he can help us sort things out or guide us to someone who can.