Libuse

Hello,

I'm new here. My husband and me are currently scoping out retirement in Spain, mainly for the weather and cost of living advantages. We are from the UK but don't have any ties here beyond friends. I realise Brexit means everything is unpredictable, but when we are ready, about 7 years from now, we will have a savings pot of around 400K gbp as well as a reasonable pension income. In a changing world I know that nothing is predictable however, my expectations are that we would have to apply for residencia and prove our income, and also pay for health insurance. However, reading this forum has alerted me to Spanish tax rules which make me think my savings will be taxable - is this correct? Thanks in advance to anyone who can help or shed some light.

Notdunroamin

You may be thinking about Spanish Wealth Tax but that doesn't kick in until €700,000 (€500,000 in Catalonia).

Savings themselves are not subject to tax but income generated from them would be.

One word of caution, if your €400,000 (in part or in whole) is coming from the sale of a property, and you become tax resident in Spain in the same tax year, then unless you reinvest the whole of the sale proceeds in a property in Spain then you can be liable for CGT on that sale.

The Spanish tax year runs from Jan to Dec.

Chipmonk

Your savings will not be taxed but any income derived from them will. However you will need to declare all your overseas assets so the spanish tax man can determine at a later date if you have been possibly not been declaring any sales, etc. Tax in general is higher in spain than uk so do not expect generous personal allowances or tax free inheritances. Basically if you think you will have accrued a sizeable amount it might be better to just live in uk but stay for 3month periods in spain. Alternatively if you have no family and arent so worried about getting through your savings then full time in spain might be what you want

Dxf

Hola

As you say, Brexit may change things; 7 years from now is a long time ahead. Blevins Franks are financial advisers that i use and i noted their advert below your post. I suggest you contact them and keep in touch as they are experts in this field. Usual disclaimer - i have no interest in Blevins except as a satisfied customer

Davexf

Libuse

Thanks all, that's really helpful advice. My plan was to sell my house in the UK then live in rented in the uk for a short while as we look for property in Spain, so the tax year information is extremely useful!

britishbull

I have been looking at moving this year but that CGT on UK house sale has me thinking about Portugal instead which does do split tax years so no CGT on UK house sale. However, the tax regime in both countries is best described as confiscatory compared to the UK where the big rip-off is just council tax. I am more inclined to buy an apartment in Spain or Portugal but limit my visits mostly to the winter and less than 183 days in a tax year. Seven years down the line, my guess is that property will be a lot more expensive but the big question is where Sterling/Euro exchange rate will end up, either or both could crash or one could go up a lot.