Non resident tax on savings for a home

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Dec 3rd 2018, 8:08 am

Elizabeth62

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Non resident tax on savings for a home

Hi all! Wonder if you can help me. I’m looking to purchase a home in Spain and want to save a deposit. I have already sorted out a bank account. If I pay a monthly sum I to a Spanish bank account to save for a deposit for a home am I liable to pay tax on my savings?

im a U.K. resident. Thanks so much 😊

Dec 3rd 2018, 8:19 am

Fred James

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Re: Non resident tax on savings for a home

You will have to pay income tax on the interest. The current rate is 19%, but that only applies to EU EEA residents. After Brexit the rate would be 24% unless some deals are done bilateraly between Spain and the UK.

Dec 3rd 2018, 12:08 pm

Loafing Along

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Re: Non resident tax on savings for a home

Quote:

Originally Posted by Elizabeth62

Check with your bank, Spanish I assume, there used to be an arrangement whereby you could open an account specifically for saving for a house provided you used the money within five years. Not sure if it still exists but we used it and the money is then tax deductible.
Sorry just checked online and the "Cuenta Vivienda" has disappeared, recommended instead are the higher interest accounts from online banks such as ING

Last edited by Loafing Along; Dec 3rd 2018 at 12:11 pm. Reason: Corrected content

Dec 3rd 2018, 2:46 pm

Fred James

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Re: Non resident tax on savings for a home

That was only for tax residents and all the money you paid in was classed as an investment in your new home and was all deductable against tax just like mortgage payments were deductible. Sadly neither are available now. When we were building our house I had such an account and it saved a very large amount of tax.

Dec 17th 2018, 6:35 pm

Johncarzx

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Re: Non resident tax on savings for a home

Tax advice is always difficult. Tax is a complicated subject and even visiting the tax authorities can end up with different and conflicting answers. Go see a tax specialist who has a decent reputation of knowing what's what.