Transfer of money from UK to Spain
 

Hello all.

I´m new here so please forgive me if this has already been dealt with.

I want to transfer 65K (euro) from the Uk to Catalonia. I am assuming that if the money is transfered from a British account in my name to a Spanish account in my name that the money will not be subject to taxation. Am I right?

The moeny was originally gifted to me. I know that in catalonia for inter family donations 3.4% tax is applicable to the first 50k (in euros) and a rate of 11% above that threshold up to 150k where the next band begins.

Has anybody had a similar experience? Please help!

Re: Transfer of money from UK to Spain
 

If you have already paid tax in the UK then you should be covered by the double-taxation treaty but if not and you are a tax resident in Spain you may well be hit by the new fiscal rules which require all worldwide assets to be declared in Spain and Spanish taxes applied. Many UK tax exemptions are not recognised in Spain.
If I were you I would seek advice from a specialist tax accountant - it will be a good investment in the long run if it saves you a load of tax.
You may get sage advice on here but will they pay your taxes for you :lol:

When you finally go ahead the make sure you comply with all the money-laundering regs or you might get you accounts frozen and in the worst case the money confiscated as it is a quite large amount. It should be straightforward as many property buyers manage it. My transfer went into the solicitor's client account and she dealt with the regs at the time.

Re: Transfer of money from UK to Spain
 

You haven't said if you are tax resident in Spain or not.

If you are tax resident, then Spanish gift tax will apply immediately.

If you are non resident then there is no tax to pay.

The double taxation treaty does not specifically cover IHT/Gift tax, but there is a general rule in most countries where you can deduct taxes paid in one country from the tax paid in Spain. However, gifts are not taxed in the UK unless the giver dies within 7 years, but the 7 year rule does not apply in Spain.

If you leave the money in the UK, as MikeJ pointed out, it will need to be declared as an overseas asset if you are tax resident. If you transfer it to Spain you will not have to declare it as it is no longer an overseas asset. Because of the size of the amount you may need to prove where it came from because of money laundering restrictions

In summary, if you are tax resident, you have a problem, if not, you don't.

Re: Transfer of money from UK to Spain
 

Hi and thanks for the swift replies. I work and reside and pay taxes in Spain.

Re: Transfer of money from UK to Spain
 

In that case seek specialist advice - and not just a gestator or abagado (unless a tax lawyer)

Re: Transfer of money from UK to Spain
 

Were you a Spanish resident in the year that received the gift?

Have you completed a form 720 ( declaration of assets held abroad? ). If not, you might face a penalty for non declaration, as it is over 50,000€

Is it necessary to transfer it here in one go or can you transfer it gradually?
If the transfer comes from an account in your name and is less than 10,000 then I don't think anyone takes any notice.

Re: Transfer of money from UK to Spain
 

Hi and a warm welcome to the Spanish forum on BE. Myself and Fred James are the moderators for the Spanish forums whilst BEVS moderates Europe. Moderators are there to ensure that the site runs smoothly within the rules of BE. This is so that members gain the information that they are looking for and find their experiences on the forums to be friendly and worthwhile.

Problems and complaints should always be addressed to a moderator who will look into the matter and deal with it efficiently and fairly. Our members who post in the Spain Forums are usually friendly and helpful with a wealth of knowledge about the issues of living in Spain. I hope that you enjoy your time participating in the forums.

Please let me know if you need any further help.

Rosemary

Re: Transfer of money from UK to Spain
 

The last bit is not good advice I'm afraid - several transfers of 10k will surely get noticed. Just follow the rules, it's easy enough. Flying under the radar is frowned on in Spain as well as most other civilised countries.

Re: Transfer of money from UK to Spain
 

Hi. No I haven't submitted a 720 and wasn't aware that I should have.
Part of the money has been in my name since before moving to Spain. Another part was transferred to my name later.

I'm now wondering if that money if subject to taxation given that it was donated tax free and legitimately under British law.

Ideally I would receive a lump sum in order to help with the purchase of a house but that's not strictly necessary.

Re: Transfer of money from UK to Spain
 

The fact that some of the money was in your account before you became tax resident is irrelevant to the Form 720. If you had more than €50000 in total in a foreign account or accounts on 31st December 2014 you should have declared it before the end of March this year.

As I said earlier, if you were a resident at the time of the gift, then gift tax could be due but cash gifts are rarely declared but legally they are subject to gift tax. The fact that it is tax free in the UK is irrelevant.

Re: Transfer of money from UK to Spain
 

Oh dear! Thanks for the info!

Re: Transfer of money from UK to Spain
 

MikeJ. I can see what you mean but I’m intrigued by your comment that ‘Flying under the radar is frowned on in Spain’.


What about the fact that the governing PP party paid to redecorate their HQ with black money from bribes; Gürtel in Baleares, Madrid and Valencia; Noos and the King’s son in law; Puñica in Madrid; Rato and his Swiss accounts; the black credit cards in Bankia; the Pujol family money in Andorra, The ERE’s in Andalucia; unused airports and empty motorways.. not to mention a black economy estimated to be 25% of GDP…if taxed, almost enough to sort out the deficit.That’s for starters! No one is in prison for any of this.


Not much 'frowning on' been going on as far as I can make out!

Re: Transfer of money from UK to Spain
 

The problem is that there is a lot of frowning and not much else!

Re: Transfer of money from UK to Spain
 

It's perfectly OK if you are high up in the hierarchy or politicos but if you are a small fry or foreigner you will be pursued to the grave and beyond :rofl:

Re: Transfer of money from UK to Spain
 

Can anyone recommend a reliable tax lawyer who can advise me about transferring gift money from UK to Spain?