Originally Posted by Lynn R

Firstly, no you cannot choose to be taxed in the UK on your state pensions. The only pension income which can be taxed in the UK, if you are tax resident in Spain, is that from Crown pensions (eg Civil Service, Armed Forces, Police, Local Government etc).

The basic Spanish personal tax allowance for anyone aged 65-74 is €6,700 (which rises to €8,100 for those aged 75 and over) plus a further €2,000 allowance for general expenses. If the spouse of a taxpayer has no income of their own, or very little, they can opt to make a joint return which gives the spouse with an income €3,400 of their allowance to set against that. However, there is also a low income allowance, which means that anyone with an income of €15,000 a year from either work or pensions pays no income tax at all so if both spouses have an income below that they would be better off making individual returns and both benefiting from the low income allowance. For income over €15,100 the low income allowance tapers away gradually until someone with an income of €21k does not get any of it, only the basic €6,700 plus €2,000 allowances. To benefit from the low income allowance, the individual must not he income from sources other than work (eg rental or investment income) of more than €6,500.

This example is based on last year's figures, there has been a further increase this year in the allowance.

Originally Posted by Algorfa1950

Out total pension income comes to just over £21,300 but my husband has the largest pensions at just over £16,000 but he is 78, so would it be best for us to do separate tax returns or joint ? We do get some income from our savings which I presume would be added to either individual tax returns or joint whichever we choose to make ?

Originally Posted by Lynn R

I would say it would be more beneficial for you to make individual returns but I am not an accountant. From the figures you give it looks as though you would pay no tax at all and your husband would have to pay a very small amount. If you employ a gestor to do your returns they will always advise you whether it would be more advantageous for you to make individual returns or a joint one, and there is also the facility whereby you can make an appointment to go to your nearest Spanish tax office and they will complete the returns for you, likewise they show you the result of making both individual ones or a joint one so you can see which would result in you paying less tax.

Yes, any savings income you have will need to be declared on your Spanish tax return, that goes in a separate box from your employment/pension income (pension income is treated as employment income in Spain).

Originally Posted by Algorfa1950

Out total pension income comes to just over £21,300 but my husband has the largest pensions at just over £16,000 but he is 78, so would it be best for us to do separate tax returns or joint ? We do get some income from our savings which I presume would be added to either individual tax returns or joint whichever we choose to make ?

Originally Posted by Notdunroamin

Your income are very similar to my own so I can tell you that there will be no advantage in doing a joint return.

If this is your first time then you both must do a return as it's necessary to get you properly enrolled in the tax system, on a low income it's that which (eventually!) gets you free medicines.

Originally Posted by Algorfa1950

What did you mean by your last sentence? I thought you always had to pay a small amount towards your prescriptions, like one euro or something?

Originally Posted by spainrico

I am in Valencia - and make a 10% contribution on my meds. Contributions are all linked to income as per declaration de renta. (Tax return)

https://www.abacotaxes.com/prescript...os%20a%20month.

https://www.gov.uk/guidance/healthca...ary-islands#s1

Originally Posted by Algorfa1950

We also have a bungalow to sell and are hoping to get it sold before the 183 days is up. If we don't what is the tax implications in Spain as this at the moment is our Primary Residence until we find something in Spain to buy.

Originally Posted by mikelincs

UK state pension is below the non taxable allowance in Spain however it's when you have any other pension that problems happen, I was receiving an NHS pension when I lived in Spain, too young for state pension, we did do a return via a gestor, and I had to pay €27 for the year, my wife was on state pension + DLA.

Originally Posted by PoloMarco

If you arrive in Spain this year and validate your NLV before 2nd July 2024, it would mean you will spend more than 183 days in Spain with any time spent in Spain earlier in the year may also accrue days. This means you will become tax resident in Spain for the whole of 2024 (1st January 2024 to 31st December 2024)

Selling property in UK whilst tax resident in Spain may mean you are liable for Capital Gains Tax on any gain in property. I’m unsure if this applies to you at pensionable age as this wasn’t relevant to me.

Sorry but I don’t understand get it sold before the 183 days is up comment.

If in doubt please seek professional tax advice.

Originally Posted by PoloMarco

OK you have sought advice - as I said it would have affected me but I wasn’t sure about pensionable age. It catches a few out!

And while discussing tax, a worthwhile reminder that UK ISA gains and Premium Bond winnings are taxable in Spain.

You need to organise finances before becoming Spanish tax resident and leaving UK residency behind. On this last point it can be difficult to open new UK financial accounts e.g. current accounts, savings etc. Several banks will close your account if you move overseas for example Barclays and several savings products have T&Cs saying if move abroad you need to close account.