Retiring to Spain
 

Hi ,
a) I'm told that retired persons ( as per E121 and E106 ) , once they become permanent residents , are entitled to free prescription medicaments , similar to the U.K. situation - could this be true ?
b ) Once you become a permanent resident , are you under obligation to submit annual tax returns , even if your combined household income did not exceed the allowances : personal , dividends etc ?
Thanks a lot in advance , for any bit of help , or additional info ,
cheers !

Re: Retiring to Spain
 

Welcome to the forum

You need to search on here and have a look in the free beer thread at the top of the page.

But in short, if you are retired then you can get an E121 from DWP Newcastle and that will entitle you to free healthcare over here.

Yes, as a resident you will become subject to Spanish tax laws which will include income tax and wealth tax. If you do a search on those two taxes in this forum you will find details

There's also the thorny issue of Spanish Inheritence tax

Re: Retiring to Spain
 

Once one of the couple have reached retirement age, then the spouse automatically receives the same benefits in health care, even if they, themselves are not yet of retirement age. You need to get an E121 form from Newcastle, and ask them to include your spouse on the form. If one of you is retired, and has received the winter fuel payment in the UK, then that will also continue to be paid when you are here in Spain, BUT you must have received at least one payment in the UK to benefit (AFAIK). Yes you will be taxed here in Spain on your income, BUT the allowances are better than the UK, and if you are receiving a pension where the income tax is deducted at source, and you cant avoid this (which happens to some pensions) then you WILL NOT get taxed a second time. Get a lawyer/gestor to do your tax returns, will save you money in the long run.

Re: Retiring to Spain
 

Thank you very much both
Mitzy & Mike for the helpful info..:)

Re: Retiring to Spain
 

A word of warning, keep your bank accounts and credit cards in the UK going preferably with a UK address. Otherwise you will have difficulty getting new ones once you have a Spanish address.

Re: Retiring to Spain
 

Yes, keep a UK bank account/credit card but don't worry about a Spanish address. Most banks are happy to keep the account open even if you are no longer resident but you will certainly have a problem trying to open an account if you are not resident in the UK.

We have a Natwest account/card and all the correspondence comes to Spain.

Re: Retiring to Spain
 

Another word of advice. Make sure the bank account you keep open has a good rate debit card, if needed to use at any time.

For example, natwest charges a transaction charge and gives a lower exchange rate, than say, Bank of Scotland, which doesnt make a transaction charge and gives better exchange rates.

Re: Retiring to Spain
 

I had a bit of a look around the "taxes" data kindly supplied , with especial view to the dreaded Wealth Tax/es ;
whereas I seem to understand that certain assets may be allowed depreciation ( homes , cars , computers , tools etc ) for tax purposes , so far I failed to find anything about Life Assurance Policies , owned by a spanish resident/taxpayer ( let's assume : a bona fidae U.K. pensioner/retireee ) ;
- since the administration , management and holdings of such policies are all held abroad , with a foreign Life Assurance Provider/Insurer ( e.g. Friends Prov. , Norwich Union , Prudential , Generali , Skandia , Zurich etc. ) , usually/often with other nominated beneficiaries , do such policies actually form part of the wealth of assets to be declared/taxed ?
- if "yes" : does it apply to any/all U.K. policies ( incl. Channel Islands / I.o.M. ones ) or only to so-called "new" PanEuropean ones , held in EU-regulated centres , like Dublin and Luxembourg ?
Alternatively : would maybe the ONLY tax applicable in Spain to those be : the usual 18% , on withdrawals/encashments , if such are taken therefrom ?
Cognoscenti , help , please !

Re: Retiring to Spain
 

Wealth tax in Spain (for residents) is applicable, like income tax, to your world wide assets.

Re: Retiring to Spain
 

It certainly covers investments. Channel Island, isle of Man, it makes no difference.

Re: Retiring to Spain
 

What are these "Bonds" that the Spanish taxman is supposed to look favorably on. He doesn't like trusts and off shore trusts bring him out in cold sweats but according to BF there is a certain type of "Bond" that can be a wrapper for many different financial instruments that is not targeted and can be held offshore?

Re: Retiring to Spain
 

The thing about having a UK address is that if you want to open another bank account/credit card you will be able but once you change everything to a Spanish address you find that you are unable to open any other accounts. I have a Nationwide credit card but cannot open a current account because of my Spanish address.

Re: Retiring to Spain
 

In order : not to " hijack the thread" , I'll try & p.m. you !

Re: Retiring to Spain
 

You might just get away with opening another type of account but just having a UK address is often not enough. You have to prove that you live there by producing utility bills at that address in your own name.

The moral is to open all the accounts you may need before you leave.

Re: Retiring to Spain
 

Try Lombard International or Irish Life.