Selling a UK property by a Spanish resident
Jan 10th 2020, 3:40 pm
#1
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Selling a UK property by a Spanish resident
Hi everyone, could you please help to understand what might be Spanish and UK tax liabilities if we sell our house in the UK? My DH and I are both UK citizens officially residing in Spain for over 3 years now. All these years our UK property was rented and we were paying UK tax from rental income. Now our tenants have moved out and, sadly, it is time to sell the house.
As I understand, in the UK we will have to pay the Capital Gains Tax, which is 18% to 28% of the margin. How it will be calculated for us? Will our income outside of the UK taken into consideration or just the UK income from the sale and the rent of the house?
Also going through previous posts on that topic I have realised that Spanish Hacienda might also want a slice of the money from my property sale. How would this work?
Any advice is very much appreciated.
As I understand, in the UK we will have to pay the Capital Gains Tax, which is 18% to 28% of the margin. How it will be calculated for us? Will our income outside of the UK taken into consideration or just the UK income from the sale and the rent of the house?
Also going through previous posts on that topic I have realised that Spanish Hacienda might also want a slice of the money from my property sale. How would this work?
Any advice is very much appreciated.
Last edited by OllyWright; Jan 10th 2020 at 5:37 pm.
Jan 10th 2020, 4:49 pm
#2
Joined: Jun 2006
Location: Granada Costa
Posts: 10,902
Re: Selling a UK property by a Spanish resident
If you are tax resident in Spain you will have to pay CGT both in the UK and Spain. You can offset the UK tax against the Spanish tax.
You should also pay Spanish tax on the UK rental income and again you can offset the UK tax. You declare both on the normal Spanish resident’s tax declaration.
Do you own your house in Spain?
You should also pay Spanish tax on the UK rental income and again you can offset the UK tax. You declare both on the normal Spanish resident’s tax declaration.
Do you own your house in Spain?
Last edited by Fred James; Jan 10th 2020 at 4:53 pm.
Jan 10th 2020, 5:32 pm
#3
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Re: Selling a UK property by a Spanish resident
If you are tax resident in Spain you will have to pay CGT both in the UK and Spain. You can offset the UK tax against the Spanish tax.
You should also pay Spanish tax on the UK rental income and again you can offset the UK tax. You declare both on the normal Spanish resident’s tax declaration.
Do you own your house in Spain?
You should also pay Spanish tax on the UK rental income and again you can offset the UK tax. You declare both on the normal Spanish resident’s tax declaration.
Do you own your house in Spain?
Jan 10th 2020, 5:47 pm
#4
Joined: Jun 2006
Location: Granada Costa
Posts: 10,902
Re: Selling a UK property by a Spanish resident
It matters because you can avoid CGT by selling one house and reinvesting it in a new residence in Spain. However, apart from the fact that you already have a house, your UK house might not qualify for the exemption.
Are you tax resident in Spain?
Are you tax resident in Spain?
Jan 10th 2020, 7:20 pm
#5
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Re: Selling a UK property by a Spanish resident
Yes, I am Spanish tax resident.
Jan 11th 2020, 7:45 am
#6
Joined: Jun 2006
Location: Granada Costa
Posts: 10,902
Re: Selling a UK property by a Spanish resident
I which case the situation, I outlinedin my first post will apply.
