Sailingmed

Hi all,

We have been a huge fan of Spain for years now, we actually have a boat based in Valencia so very familiar with the Costas and feel in the next 2 or 3 years we may want to move there (depending on how things look after the transition period). I've been doing preliminary research and one major sticking point would appear to be the wealth tax. Having sold a business a few years ago I have a couple of large discretionary portfolios and a good size sipp (I'm 42 so can't touch this until I'm 55) so as it stands the wealth tax would clobber me (and make my current UK tax bill look small!). Are there any ways around this?

Thanks in advance.

Moses2013

If worried about wealth tax, you're in a good position anyway. If it's a problem the best option is to not make Spain your main residence. Keep two homes and enjoy both countries at the best time. At least you still have something to look forward to and it's more enjoyable. Of course a tax expert will probably be best in your situation.

Sailingmed

Thanks for the reply

We may consider 2 homes but we were planning to blow the budget somewhat on the spanish home which would make a uk home a little difficult. I've emailed a couple of recommend tax advisors to see how things look. We dont plan to do anything for a couple of years as we want the dust to settle over corona and Brexit (although that may be never ending) and see if the suggested property crash occurs and see if euro comes back in gbp's favour.

scot47

"I want the benefits of living in this country but I do not want to pay tax". Hmmmmmm.

Sailingmed

I'm all for paying tax, its just the wealth tax could be such substantial (rough calc suggest 2 times income tax again) so if this can be legally minimised through good advice then so be it

Longlegpete

The wealth tax is only a small percentage of what you have over 700,000 euros at the time of purchase excluding your main residential home, certainly that's how i understand it, please someone correct me if I'm wrong.

Again as far as i remember it it's only 1% tax rate on the amount to be taxed so not much money equivalent to one's wealth so probably not much to worry about

Fred James

The base allowance is 700k each and your primary residence is exempt up to 300k, so 600k for joint ownership, so that totals 2m for a couple.

The rates vary slightly by region, but there are 8 tax bands from about 0.25% up to a maximum of around 3% over 10m.

Dxf

Hola,

You say you have contacted a couple of tax advisers; If you haven't already, then contact Blevins Franks who are experts on tax and have offices in both countries.
Usual disclaimer, I have no interest in Blevins Franks except as a satisfied customer

Davexf

Sailingmed

Thanks, Blevins Franks are one of the companies I've sent an enquiry over to.

m2m2012

I don't know the answer to this, but how likely is it that the 700,000 amount will be lowered and the tax rate will be raised in the near future? Spain will take a HUGE hit from corona in terms of budget deficit and debt to GDP. I cannot see them lowering this tax that's for sure.

Sailingmed

I'm hoping the allowances won't be adjusted down. We are still 2 or 3 years away from making the move anyway so hopefully all things Corona and Brexit will be clearer by then

Fred James

Personally, if I was worth as much as €10m I would not have a problem contributing a mere €250k to the ailing Spanish economy.

i certainly would not worry about it.

Lagoo

I feel the same as you Fred. IMO Spain is better to live in than the UK and if you want to travel 1st class you have to pay extra.

But maybe that's why we're not worth €10

m2m2012

I wouldn't have a problem either IF I had been born and raised in the country (I had used the schools, my kids had used the schools, hospitals, etc.) and had become wealthy via sources from within the country. To move to Spain to retire and be hit with a wealth tax...no thank you! Plenty of other countries to choose without a wealth tax. You can always donate to charity if you want to help the less fortunate.

m2m2012

Dealing with mind numbing bureaucracy is 1st class?