Neptuno

We see so many posts on here and other forums asking advice on tax matters.
I would say to anyone contemplating a permanent move to Spain-Don't, unless your financial affairs are very straightforward and simple.
If you have bonds, savings ,investments in UK it can make life complicated here, and "experts" will give you conflicting advice as to what to do with them.
If you are due to receive an inheritance in UK, pension pot, matured savings plan,etc, you should wait until you have received them long before moving here, or if they are imminent, don't live here long enough to be tax
resident, or your years of savings,profits, interest will be plundered by the Spanish tax man.
Even though your financial problems may be sorted out by an accountant here, it won't be without cost!

It is just not worth it just for a sunnier climate and supposedly less stressful lifestyle. Better to stay in UK and have holidays here, with none of the financial pain.
Even if your financial affairs here are sorted, you may have to deal with the old enemy IHT. Now that Murcia has abolished the regional allowance, leaving a derisory just under 16,000 euros to offset against what may be hundreds of thousands of assets,it is a real problem with no satisfactory way of avoiding it that doesn't have serious drawbacks.It is one of the main reasons ex pats return to the UK.
Now, if you are one of the many who takes the risk, lives under the radar, continues as if still living in the UK, none of this will bother you, but if you are one of those seriously considering moving here, it should make you stop and think.

Porth

We are ahead of you and moving back. Have been here for a short time established nothing here and what we have is secure under discretionary Trusts in the UK. We are very much above the radar in all of our dealings and simply do not want a knock on the door.

Add to that the Health Scenario and it is hugely difficult for us.

One can always buy holidays with the sun shining without having to live in Spain.

agoreira

I have always been a big supporter of that idea! Been doing it for around 30 years. Friends that have holiday homes go to the same place every year, spend most of the holiday painting, running repairs etc, replacing the solar panels that have been stolen etc. If they are happy to spend every holiday in the same place, fine, and although we've gone back to some places many times, we always like to try somewhere new. I'd sooner spend the money on renting something decent, with all mod cons, plus I don't have to shed any tears over the value of any property diving, or even worse, finding out it's illegal!

me me

Good advice, as a lot of people will be waiting for "money" to come in from the different sources that you mention.

There will be the early retirees, who have elderly parents still living in the UK, and in the not to distant future they will possibly be inheriting a house.

I am sure their parents would not wish to see a great chunk of their life savings being paid to Hacienda, simply because the heirs just happen to be Spanish residents.

Timing is very important, and only a fool would willingly hand over IHT to hacienda when it can be so easily avoided.

lutonlad

Good advice no doubt.

I am sure a lot of non residents are now focused on making sure that they keep
within the 183 day rule, even though they may have been complacent about
it in the past.

I wonder, under what circumstances would the hacienda question the status of a 'non resident'
who may have inadvertantly exceeded 183 days in a previous year?

stuboy

For the honest man Spain appears to becoming a nightmare with regard to this area.

the dishonest and dodgers will always take their chances, plead ignorance and disappear back to the UK often beyond the reach of the hacienda.

A lot of people are waking up to the fact that Spain is not for them. They are simply not prepared to take the risk of living in a fast becoming Police State to see their life's work handed over to another corrupt official.

The sun is not enough of a reason to move nor is the old platitude of 'lifestyle'

The smart ones have already left.

Unfortunately for the dreamers lured by watching endless repeats of 'Place in the Sun' the dream along with their conviction and desperation to escape from whatever they hate about their lives in the UK shows no sign of abating.

cricketman

I've no idea what you are taking about

Why is having to declare your assets being part of a police state?

Honest people have very little to be worried about. The new regulations are there to catch dishonest people who have been hiding assets and trying to avoid taxes in Spain.

Will there be future taxes if you declare your assets? Who knows? But you can say the same about any country.

me me

There you go again.

Why do you always think the worst of people.

A lot of expats who have been paying what their dues to hacienda, now find that it is not enough to satisfy their greed.

I personally know of a few expats who have never declared banks accounts they they were authorised to sign, ie for elderly relatives who are in care homes..

Now they have had to declare these accounts in great detail, even though the money in the account does not belong to them, whereas before the 720 they did not.

And then on top someone like you calling them dishonest for "hiding" assets.

you just brand people right across the board who don´t fit in with your opinion as criminals, when all they want to do is keep the money safe in the accounts that they have been entrusted with.

snikpoh

I actually agree with cricketman on this occasion!

If you have nothing to hide then, as he says, you should be fine. In your friends situation, I would like to think that declaring the bank accounts on 720 will have no effect.

NO ONE is calling them dishonest - you need to read his post again, clearly.

me me

I think the same could be said about you reading the post clearly.

And about you thinking that it will not effect them, I am sure that hacienda will not be consulting you, when they are deciding what to do with the info.

cricketman

The modelo 720 has been championed from Brusells as a way of catching tax evaders. Something which people on here say is one of the major problems that Spain has.

So the government do something about it by tightening regulations, but as it is a tiny bit of administrative work, everyone here moans and say that Spain is trying to steal their money.

Tax rules in Spain are, and always have been that you must declare and pay tax on your worldwide income. If you dont like that then you are free to move to another country, as some on here have done

me me

Why should the spanish tax people have information on bank accounts of people who are not even residents of Spain, who have no intention of becoming residents, and in some cases, never even set foot in Spain.

You think that is OK?

The case of moving somewhere else is not even relevant in those cases, because the older people involved have never left the home country.

Can´t you see that?

If I had lived all my life in the UK and had my daughter who is able to administer my bank accounts due to my bad health or whatever, I would strongly object having my details given out by her to the tax authority of a foreign country.

Of course you will say you would have no such objection.

It has nothing to do with world wide income, as the signatory has no income from their parents account.

Porth

I am with me me on this in that we have Power of Attorney over my Mother in Law's affairs and have both health and finance authority.

So someone in Hacienda in Javea sees say £250,000 in an account and which has a header of our name and says you have access it is yours.

Yes we have access but the law of the UK says we have to act in the best interests of those for whom we have Power. I say that also as a now retired lawyer.

Out of this comes the fees for the Nursing Home. Will Hacienda understand. Do not think Power of Attorney and which is a Common Law issue is recognised in Spain. Come to think about it wonder what the Courts here are all about. Common Law and precedent is much better than things I see here. Spain is not alone France is a codified system I do not like that either.

Porth

I also believe in an open society and have little problem in disclosing information but what happens to that information is totally another argument.

If you are entrusted with information you have to act reasonably. I do not see that happening here in Spain.

Neptuno

In regard to the 720, which is definitely NOT a tiny bit of administrative work, whereas people have no objection to declaring their assets, they do object to baring their financial souls, having to enter minute private detail-account number, iban/swift no,when started, finished etc. It would be easy enough for a crooked employee to misuse these details and commit ID fraud-will the bank then say to the affected person that they shouldn't have given this private info?We had no choice but to supply it.
Why wasn't it enough to have a section on the income tax form and just state how much there was in each category. As they can already access our accounts, if they wanted to know more they could have found it out.
Everyone who has been honest enough to supply this info was then terrified that an innocent mistake or omission of some ancient account would bring forth a fine of 10,000 euros minimum. The fact that we had to trust an accountant to correctly enter this sensitive info, at no inconsiderable cost, meant that we had to worry that all was well, as the client would be the one to be fined, not the accountant.